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Russian President Vladimir Putin has signed a bill banning payments with digital financial assets. The law obliges exchange operators to refuse to process transactions that facilitate the use of DFAs, a legal category that currently covers cryptocurrencies, such as “monetary surrogates.”
Russian President Vladimir Putin has signed a law imposing direct restrictions on the use of digital financial assets (DFA) as a means of payment in his country, the crypto page of the RBC news portal reported. The ban also applies to utilitarian digital rights (UDR).
Russia has not yet fully regulated cryptocurrencies, but the law “On Digital Financial Assets”, which came into force in January 2021, introduced the two legal concepts. Russian officials have previously indicated that DFA includes cryptocurrencies while UDR applies to various tokens. This fall, Russian lawmakers will review a new “On Digital Currency” bill designed to fill regulatory gaps.
The legislation, now approved by Russia’s head of state, was submitted to the State Duma, the lower house of the Russian parliament, on June 7 by the head of the Financial Markets Committee, Anatoly Aksakov, and passed a month later. Until now, Russian law has not explicitly prohibited payments with digital assets, although “monetary surrogates” are prohibited and the status of the ruble as the only legal tender is enshrined.
While the bill prohibits the exchange of DFAs “for transferred goods, work performed, services performed”, it leaves the door open for cases of DFA payments provided for in other federal laws. In the midst of expanded economic restrictions, imposed as part of Western sanctions over the invasion of Ukraine, a proposal to legalize small-scale cryptocurrencies in foreign trade with Russia’s partners has received support in Moscow.
Along with banning direct payments with digital financial assets, the law also obliges the operators of platforms offering exchange services to reject all transactions that could potentially lead to the use of DFAs to replace the Russian ruble as a payment instrument.
The new legislation enters into force 10 days after publication in the Russian Government Gazette. Regarding the possibility of an exception in the application, the RBC report notes that Russian legal experts have already highlighted certain controversies in the document.
Do you expect Russian companies to find a legal way to use cryptocurrencies in payments? Share your thoughts on the subject in the comments section below.
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