In this article, we will look at how Russia controls cryptocurrency and what measures are being taken to strengthen this control. It must be admitted that the authorities are very unhappy with the “elusiveness” of digital money, because with its help owners can evade taxes, buy and sell goods on the black market, or launder illegal proceeds. Therefore, the nuts are tightened more and more.
It is assumed that in the next three years the mechanisms will become more serious, but so far everything is rather damp. Despite the fact that from January 1, 2021, the law “On digital financial assets” is in force, it does not provide full answers to all questions.
Why should the state control cryptocurrency
Sergey Shcherbinin, Head of IT Development at the Ural Bank for Reconstruction and Development, formulated the following objectives of control over cryptoassets:
• preventing the laundering of criminal proceeds;
• obstacle to financing terrorist organizations;
• protecting Russians from high market volatility and associated losses;
• support for its own state cryptocurrency.
Unfortunately, too active measures of a controlling or prohibitive nature are ways to slow down the development of blockchain technologies and slow down many promising startups.
Igor Bederov, a specialist at the SafeNet engineering center, said that by 2025 the government will completely take cryptocurrencies under the “cap” and identify all its users. Primarily to levy taxes on trade turnover. The Ministry of Finance, Rosfinmonitoring and the Central Bank did not comment on their plans.
How cryptocurrency control will be carried out in Russia
There are two main ways in which transactions are expected to be tracked:
• information and analytical solution for identifying users of crypto wallets by tracking their “traces” in the Internet space;
• involvement of Russian financial institutions in the process, which in one way or another participate in the withdrawal of cryptocurrencies to the card / electronic wallets, as well as the transfer of funds to crypto-exchanges.
The investors and traders identified in this way will be obliged to declare their operations through the State Services.
A service called “Transparent Blockchain” has already been developed for analyzing Bitcoin transactions. However, he is not yet able to massively identify market participants. Also in some cryptocurrency-related investigations, workstations have been used, which have proven to be highly functional and efficient.
Crypto Ruble and its Impact on Future Regulation
At the moment, the adoption of the “digital ruble” in Russia is being actively discussed. The government is considering measures to encourage users to convert their assets into the digital ruble in order to minimize uncontrolled direct transfers of crypto between individuals. This will require a number of amendments to the law on CFA.
When the digital ruble is deployed, control over the holders of the cryptocurrency will be carried out by analogy with accounts in foreign banks, when users will convert the ruble to regular cryptocurrency and vice versa.
Of course, it will be difficult to take control of anonymous cryptocurrencies like Monero. Their infrastructure assumes minimal transparency, so it is almost impossible to track user actions. It remains to take “on the pencil” cryptocurrency operators, who now belong to the gray zone. Already, most of the world’s exchanges require the user to undergo verification and track all their transactions for suspicious activity or money laundering.