Russia Cross-Border Crypto Payments Begin Amid Sanctions
In an attempt to get around international sanctions, Russia will start testing cross-border cryptocurrency payments next week. However, some legal and policy experts warned that this endeavor would not succeed. President Vladimir Putin immediately signed legislation enacted at the end of July into law, allowing cryptocurrency transfers across borders but not lifting the ban on using cryptocurrencies as legal tender for regular payments within Russia.
The legislation does not clarify standards for such transactions, so it is unclear how the law will permit such payments. Rather, it gives the Russian central bank authority to manage an “experimental” system, according to experts. Following its invasion of Ukraine, the United States and other countries imposed several sanctions on Russia, which have severely hurt the country’s economy. Russia has been subject to 16,500 sanctions from the United States, United Kingdom, European Union, Australia, Canada, and Japan since it invaded Ukraine in February 2022.
Crypto Legislation in Russia: New Details Emerge as Central Bank Seeks Feedback
In the days before the law goes into effect on September 1st, some information has come to light. Using Google Translate, CoinDesk examined a copy of the legislation. “During the digital currency circulation in the Russian Federation, special regulations may be established by the experimental legal regime program,” the statement reads. The creation of that regime is ongoing. The central bank will take domestic stakeholders’ ideas and suggestions into consideration before making a final decision.
Some players, including us, have already come with our own proposals. The central bank will decide if it fits with their view. They are moving very fast, so it won’t take much time.
Anti Danilevski, founder and CEO of Kick Ecosystem
Russia’s Central Bank to Guide Upcoming Crypto Payment Trials Using Existing Infrastructure
According to Bloomberg, Russia intends to test payments by allowing users to switch between rubles and cryptocurrency using the National Payment Card System. The system was selected due to its pre-existing infrastructure for features such as interbank settlement and its complete central bank regulation. The source also stated that should the trials be successful, Russia might permit the establishment of cryptocurrency platforms by the Moscow Exchange and the St. Petersburg Currency Exchange in the upcoming year.
The regime’s exact parameters are not clear because none have been published yet, according to Ivan Chuprunov, an associate professor at the Research Centre of Private Law in Moscow. However, he added, the central bank will likely publish some guidance in the coming weeks. Furthermore, it seems that the central bank is free to alter how it conducts these trials at any time under the statute. According to the law, some sections of the Federal Law pertaining to transactions involving digital currency made in the implementation of foreign trade activities through an authorized organization may be excluded or changed.
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