Russia Gets Even Tougher on Bitcoin

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It’s no secret that the Russian government hates cryptos. Anything that’s not the ruble is essentially forbidden or about to be forbidden in Russia. The Duma has done everything in its power to ban Bitcoin, making life hard for Bitcoin owners and fans.

The latest update of the draft law “On Digital Financial Assets” was recently released for public comment and it didn’t spell great news for cryptocurrencies. The new law prohibits the circulation of all cryptos including their advertising and even mining. This means that cryptocurrencies are set to enter a grey zone in Russia which shouldn’t be surprising at all considering the Duma’s history with Bitcoin.

Exchanges and .ru Domains at Risk

The new law shows that Russia has really dropped the hammer on Bitcoin and cryptocurrencies. This puts the Russian crypto market at a big disadvantage. Exchanges and .ru domains are now at risk of perishing with the law set to go into effect this summer.

Russia has been trying hard to regulate cryptos since the beginning of 2018. The latest updated on the proposed law will effectively banish cryptocurrency exchanges on Russian territory. Anti Danilevski, CEO of crypto exchange KickEX, says that he’ll now move his business to the EU because it’ll be impossible to survive in the harsh anti-crypto atmosphere in Russia.

“It’s a pity that tech startups are forced to leave our country,” Danilevski said. “While the world is moving forward, we are going backwards.”

There is, however, a bit of hope glimmering at the end of the dark tunnel. Danilevski says that the law is focused on tokens, not digital money itself. Since digital money is different from digital assets, the Russian hammer still hasn’t dropped on cryptos. It’s a fight against cryptocurrencies, not the blockchain.

Newcomers to the crypto market should know the difference between cryptocurrencies such as Bitcoin and digital assets issued by a tech company. They all depend on the blockchain, yet the blockchain doesn’t require cryptocurrency itself.

Harsh New Rules

The latest anti-crypto draft law updates prohibit the issuance of and operations with digital currencies on Russian territory. Both individuals and companies would not be able to accept digital currencies as payment. In short, all companies with a .ru domain that planned on adding crypto payments to their sites will now be unable to do so. This means that Bitcoin casinos and gaming sites will never see the light of day in Russia, no matter how popular they get.

All Bitcoin owners will need to declare the cryptos at the tax agency and provide information about how it was purchased. To put it simply, Russia is becoming a crypto owner’s hell.

If anyone decides to buy cryptos from a Russian bank will face a fine of up to 1,000,000 Rubles and possibly up to 7 years in prison. This shows how much the Duma hates cryptocurrencies. Other countries around the world have banned the use of Bitcoin, but rarely any country went this distance.

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June 10, 2020: • No Comments

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