New Bill in Russia Aims to Prohibit Digital Financial Assets as Payment Method

Swift Passage in the State Duma

A bill introduced just last week has made a surprisingly quick advance through the first reading in the State Duma, Russia’s lower parliamentary chamber. If this bill receives final approval, it would enact a ban on utilizing “digital financial assets” (DFAs) for purchasing goods or services—talk about hitting the brakes on e-commerce!

Details of the Proposed Law

Spearheaded by Anatoly Aksakov, head of the Financial Markets Committee, this legislation comes with an interesting twist—it specifies that DFA exchange managers must withhold any transactions involving tokens as surrogate money. However, there’s a silver lining: exceptions may arise where “prescribed by federal laws.” So don’t tuck away your digital wallets just yet!

Critics Sound the Alarm

Legal experts have raised their eyebrows at the bill’s implications, arguing that it tightens the leash on digital rights and tokenized assets. One point of contention is the classification of DFAs. While they’re being referred to as payment means, DFAs have generally been recognized as security tokens. It’s akin to calling avocado toast a pizza—it just doesn’t fit!

The Mystery of the “Monetary Surrogate”

Another eyebrow-raising element revolves around the term “monetary surrogate.” This bill indicates a desire to prohibit DFAs as such, yet it fails to define what constitutes a monetary surrogate in Russian law. It’s like trying to explain TikTok trends to your grandparents—everyone’s confused!

Introducing Electronic Platforms

The proposed legislation also rolls out the term “electronic platform,” which remains vaguely defined, encompassing anything from financial platforms to investment systems. These electronic platforms would now be recognized as part of the national payment system and would be required to report to the central bank’s registry. Every major operation involving DFAs, including their issuance, circulation, and trading, would have its own registry. It seems like everything is about to get a bit more bureaucratic!

The Context of Digital Financial Assets in Russia

The existing laws relating to Digital Financial Assets took effect in 2021, and they are evolving fast. Back in May 2022, tax changes concerning DFAs had already passed their first reading in the Duma. Additionally, two significant bills are making their way through the legislative labyrinth: one aims to outline a regulatory framework for cryptocurrency, while the other will establish regulations for miners. Stay tuned, because the digital landscape in Russia is merely an unfolding soap opera!