Russian watchdog to oversee the cryptocurrency sector

Russian watchdog to oversee the cryptocurrency sector

Economics and regulation

The Federal Financial Monitoring Service of Russia has revealed that it will regulate cryptocurrency transactions in the country, with a senior official saying that the agency will also oversee the broadest cryptocurrency industry, in accordance with the recommendations issued from the Financial Action Task Force (FATF).

Read also: Ukraine plans to fully legalize cryptocurrencies within three years

Rosfinmonitoring to License
ICO exchanges and platforms

<img class = "alignright wp-image-238125 size-medium” title=”Russian watchdog to oversee the cryptocurrency sector” src=”×300.jpg” alt=”Russia's financial watchdog to oversee the cryptocurrency sector "width =" 272 "height =" 300 "srcset ="×300.jpg 272w , https: //×846.jpg 768w, 696×766. jpg 696w,×420.jpg 381w, Rosfinmonitoring.jpg 800w "sizes =" (maximum width: 272 px) 100vw, 272 px”/>Rosfinmonitoring, as the regulator is known in Russia, plans to register, license and monitor cryptocurrency exchanges, crowdfunding platforms and portfolio service providers for digital resources, Russian media reported. Pavel Livadny, deputy director of the agency, said that all states participating in the FATF should change their legislation to introduce registration and licensing regimes for companies that trade cryptocurrencies and launch the first coin offerings (ICOs).

The intergovernmental organization, initially in charge of developing measures to prevent money laundering, has recently updated its recommendations and the glossary to include "virtual goods". The FATF uses the term to mean "digital representations of value that can be exchanged or transferred digitally and may be used for payment or investment purposes, including digital representations of value that function as a medium of exchange, unit of account and / or deposit of value. "He emphasized that virtual assets are distinct from legal currencies and stated that they will continue to review them to determine if further updates to its standards are needed.

The financial controller will regulate the exchange of cryptocurrencies and legal tender, as well as transactions between digital assets. It will also monitor the transfer, custody and issue of digital coins, as reported by the newspaper Izvestia. The minimum value of cryptocurrency transactions that will determine regulatory action has not yet been determined, but the agency has stated that it will track transactions involving the transfer of 600,000 rubles (~ $ 9,000) or more. It has been reported, however, that transactions of less than 15,000 rubles, or about $ 230, may remain anonymous.

Criticisms of organizations in the sector
Legislation sponsored by the government

<img class = "alignright wp-image-238131 size-medium” title=”Russian watchdog to oversee the cryptocurrency sector” src=”×195.jpg” alt=”Russia's financial watchdog to oversee the cryptocurrency sector "width =" 300 "height =" 195 "srcset ="×195.jpg 300w , https: //×498.jpg 768w, 696×452. jpg 696w,×420.jpg 647w, shutterstock_753649534.jpg 1000w "sizes =" (maximum width: 300px) 100vw, 300px”/>The Russian cryptocurrency industry is still largely operational in an atmosphere of legal uncertainty. Last spring, the state Duma legislators, the lower house of the Russian parliament, supported at first reading three legislative proposals aimed at regulating the sector, but then postponed definitive adoption for the autumn session. The main bill, "On digital financial resources", was subsequently renewed, with legislators removing key terms such as "cryptocurrency" and "data mining".

The Russian Union of Industrialists and Entrepreneurs (RSPP) recently sent legislative proposals to Prime Minister Dmitry Medvedev, president of Duma Vyacheslav Volodin and Andrei Belousov, assistant to President Vladimir Putin. In the documents, RSPP President Alexander Shokhin has criticized the current bill, arguing that he sets unreasonably high standards and introduces complicated regulatory procedures. He called for the adoption of a consolidated position, which will be approved by all market participants and state regulators. An alternative law proposal, drafted by the RSPP, not only cites cryptocurrencies, but also gives them a "special status". According to the Kommersant newspaper, the proposals of the RSPP will soon be discussed by three different ministries.

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Meanwhile, Yuri Pripachkin, president of the Russian Association of Cryptoindustry and Blockchain, warned that the implementation of the regulatory framework without taking into account the views of the sector would lead to an exodus of investment capital and young talents. "It makes no sense to adopt legislation in its current form," he said, as quoted by the daily Vedomosti.

Pripachkin added that the Duma bills do not even deal with the areas that determine the development of the new sector – including cryptocurrency, mining, and smart contracts – but are limited to focusing on the term "digital resources". Adopting a law that targets only the tokens circulating within companies could put an end to the economy of cryptocurrency, he said.

Do you think that Russia's financial watchdog should also be responsible for regulating the crypto-industry? Share your thoughts on the topic in the comments section below.

Images courtesy of Shutterstock.

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