Russian State Duma considering partial authorisation of digital currency payments

Russian State Duma considering partial authorisation of digital currency payments
Photo: pixabay.com

Digital currencies have been illegal as a means of payment in Russia so far, but now there is a chance that they will be allowed as a contractual payment if lawmakers pass the relevant amendments.

Russian lawmakers are weighing partial reversal of digital currency payments ban, reports CoinGeek adding that they may allow digital currencies to be used as payment in domestic contracts. Currently, the ruble is the only currency accepted as a means of payment in the country. Russia’s Central Bank has also been researching and developing a digital ruble, while the use of bitcoin and other digital currencies for payments has been ruled out by the regulator.

However, lawmakers in the lower house of the Russian parliament are considering some revisions. Head of the State Duma’s Committee on State Building and Legislation Pavel Krasheninnikov has recently announced that there were proposals to amend the law to allow digital currencies as a payment medium in domestic contracts. Speaking at the St Petersburg International Legal Forum last week, the lawmaker admitted that the current law restricted merchants from accepting digital currency payments and proposed allowing such transactions if the two parties conducting the payment consented to digital currency payments. “Currently, there is an understanding that digital currency is not legal as payment, but this payment method, quite possibly, can be contractual,” he said.

Russia is home to a large number of cryptocurrency miners. Photo: pixabay.com

Such an amendment would open a big market in the country, which is currently behind its peers such as South Korea and Canada in digital currency adoption. Russia, the 11th largest economy globally, is home to a large number of cryptocurrency miners. In the recent past, Russian regions with low power costs and a cold climate, such as Siberia, have seen an uptick in mining activities.

Meanwhile, the US wants to strengthen regulation of the digital currency industry: the country’s lawmakers have proposed that all digital currency payments exceeding $10,000 should be reported. “Further, as with cash transactions, businesses that receive crypto assets with a fair market value of more than $10,000 would also be reported on. Although cryptocurrency is a small share of current business transactions, such comprehensive reporting is necessary to minimise the incentives and opportunity to shift income out of the new information reporting regime,” reads the US Department of the Treasury’s recent statement.

By Anna Litvina