Russia Considers Criminal Liability For Unregistered Crypto Operations

Aug 25, 2018 at 22:00 Update Date :Aug 25, 2018 at 22:00 UTC

The Ministry of Internal Affairs of Russia has, according to reports, proposed the criminalisation of unregistered crypto activity.

According to local reports, the ministry is currently working on amending the laws concerning the legalization of operations with open source alt-coins like BTC, ETH, etc. The ministry had proposed that people looking to conduct legal trade in virtual assets should first procure a “mandatory registration with state authorities conducting financial and tax regulation.”

This move has been headed by the ministry’s Main Directorate for Drugs Control (GUKON). Andrey Khrapov, the GUKON head, reportedly asked the Russian Finance Ministry to describe their standpoint in the newly proposed changes in the law.

According to reports, the Ministry of Economic Development has chosen to stay sceptical regarding the new legislative measures, maintaining that it might still be too early for considering criminal liability for crypto-operations. Savva Shipov, the deputy chief of the economic development ministry explained that the Russian legislation still contains no guidelines for specifically regulating the trade of digital currencies.

However, Shipov also stated that prosecution for using crypto would still be a legal action, in cases where cryptocurrencies are used for financing illicit activities, such as scams, and drugs or arms trafficking.

CEO of Sputnik DLT, Artem Tolkachev had backed the economic development ministry’s stance on the issue. Tolkachev explained that “it is too early to speak about the criminalization of illicit [unregistered] cryptocurrency operations”, especially considering that the required laws for the industry are still non-existent.

The Russian Finance Ministry issued its first complete regulatory framework earlier this year in January. Named “On Digital Financial Assets”, the circular was expected to be in motion by 1 July. However, it has, as of yet, only been approved in the first 3 readings by the Russian parliament.

The newly authorised version of the bill makes all general activity pertaining to alt-coins and ICOs legal. However, it still bears a straightforward notification stating that virtual currencies “do not constitute a legal method of payment within the territory of the Russian Federation.”

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