Bitcoin gives way to ruble: Putin signs law banning cryptocurrencies in Russia
Bitcoin and other types of crypto have just been banned in Russia by none other than the commander-in-chief himself.
A Russian legislative support website said Russian President Vladimir Putin on Saturday approved legislation banning the immediate use of digital financial assets as a payment method in the country.
The mandate is the result of long discussions between the Russian central bank and the government about cryptocurrencies. In addition, the action maintains the ruble as the only legal tender in the Russian Federation.
The Russian assembly, known as the Duma, gave the green light to the initiative last week. The restriction is in addition to a law from 2020 that prohibited the use of cryptocurrencies as payment for goods and services.
Russia is giving more premium on its legal currency, than crypto. Image: Mint
Ruble beats Bitcoin in Russia
The law also allows owners of platforms that offer exchange services to block all transactions that make it easier to replace the ruble with digital financial assets.
The regulations also apply to utilitarian digital rights (UDR). The new law comes into force 10 days after it was published in a Russian public publication.
Previously, Russian officials have claimed that DFA includes cryptocurrencies, while UDR applies to a number of digital assets. New legislation called “On Digital Currency” will be debated by Russian parliamentarians this autumn in an attempt to fill loopholes in regulation.
According to Russian law, cryptocurrency exchanges are “subjects of the national payment system” and must follow rules that, among other things, limit the economic activities they are allowed to perform and prohibit the delivery of influence and return products to consumers.
Suggested reading | Shanghai aims for $ 52 billion in Metaverse Tech Economy by 2025
Strict compliance with the new law
By holding exchange operators and companies liable for breaches, compliance will be enforced.
In January, the Bank of Russia proposed a complete moratorium on the use of cryptocurrencies for payments and investments.
In February, the Russian Ministry of Finance sent a draft of cryptocurrency legislation to the government, which, like the current regulation, allows investment in digital assets such as Bitcoin and Ethereum, but not their use to buy goods.
BTC total market cap at $396 billion on the weekend chart | Source: TradingView.com
Suggested reading | Indian regulator gets rid of its only crypto exchange body – Bane or Boon?
Bitcoin breaks the $ 20,000 level
As of this writing, Bitcoin is trading at $ 20,629.90, down 5.7% over the last seven days, according to data provided by Coingecko on Saturday.
This year, Russia has been investigated for allegedly using cryptocurrency to avoid sanctions imposed after the country attacked Ukraine.
Anatoly Aksakov, the head of Russia’s finance panel in the Duma, revealed that a draft resolution to oversee cryptocurrencies would be introduced later this year.
Featured image from PiPa News, chart from TradingView.com
