The Russian Ministry of Finance reportedly presented its draft legislation on digital asset regulations. The institution called upon enhanced protection rules and set a limit on annual cryptocurrency investments.
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Russia’s top authorities are still far from reaching a unanimous decision on how to approach the local cryptocurrency market. The Bank of Russia insists on a total ban of all digital asset endeavors, while the Finance Ministry urges for proper regulation.
According to a recent coverage, the latter has not backed away from its plans to legalize the market. The bill reads that the use of cryptocurrencies as a payment method will still be prohibited on Russian soil, but they will be considered an investment instrument.
The Finance Ministry is willing to impose further security rules. If the bill gets approved, every crypto transaction would require customer identification.
In addition, the lawmakers opined that foreign digital asset exchanges should obtain a license to operate on Russian territory. These trading venues should also introduce financial literacy tests to their clients and thus determine how many individuals are permitted to invest.
Residents who successfully pass the tests will be able to allocate up to 600,000 roubles ($7,806) in digital currencies each year, while those who fail will have a limit of 50,000 roubles ($650) annually.
The Ministry is also in favor of cryptocurrency mining, but the authorities suggested that it should be taxed.
President Vladimir Putin is a proponent of this niche, too, recently saying Russia might benefit from it. The country is a leader in the digital asset mining scene, accounting for 11.2% of the global hash rate. The USA and Kazakhstan are the only nations ahead of it.
Russian Banks Should be Able to Deal With Crypto
Earlier this month, Russia’s Minister of Finance – Anton Siluanov – proposed that local banks should be able to provide cryptocurrency services. He also suggested that allocating funds in such assets should be treated as investing in precious metals.
Many experts argue that bitcoin and gold share similar characteristics. They are both alternative investment assets, which traders often pick to diversify their portfolios.
The yellow metal has been the traditional store of value asset for centuries due to features like its scarcity.
Bitcoin’s supply is limited, too. The primary cryptocurrency has a maximum cap of 21 million coins, making it an attractive tool during financial crises and inflationary events. As such, many believe that BTC has earned a nickname – “digital gold.”