The Chairman of the State Duma Committee on Financial Markets, Anatoly Aksakov, has confirmed that progress on the legislation about digital financial assets has been completed.
Russian media reported the latest development that comes in the wake of worldwide uncertainty following announcement of the COVID-19 pandemic that has wreaked havoc across traditional financial markets.
Defining Cryptocurrencies
Chairman Aksakov, who doubles up as the deputy of the State Duma of the Federal Assembly of Russia, has been a key figure in the bill’s drafting process. In explaining the matter, Aksakov intimated that the bill was created with an intention to clarify the meaning of cryptocurrencies by going further to interdict their application as a mode of payment.
According to the official, the ambition to prohibit the use of crypto was arrived after the Federation identified grey areas surrounding their application.
The law will exhaustively explicate all categories of digital financial assets, the methodologies of their issuance as well as crypto circulation. In addition, the legislation will touch on issuance and distribution of the crypto assets secured by actual goods.
Point to note, the bill did not make mention of any subject surrounding the practice of crypto mining. This, according to Aksakov, was because of the nature of cryptocurrency mining – mining digital assets is a category of business that creates actual economic value, thus should be taxed by law.
Also importantly, Aksakov explained that the new legislation will not touch cryptocurrency exchanges as long as they do not contravene any government directives – although their activities will be regulated.
Adoption Affected by the COVID-19 Pandemic
While work on the bill to check Russia’s crypto industry is complete, Aksakov commented that adoption of the new law has been delayed due to the current global COVID-19 pandemic. This delay has been created by the institutional go-slows witnessed across all government arms, with legislative processes being scaled down to focus attention on public health matters.
Looking back, the bill on digital financial assets was first submitted to the State Duma in March 2018. The Russian official explained that the 2-year-long dilemma was caused by numerous disagreements within government corridors, including opposition from the Central Bank of Russia, concerning crypto assets. This followed a series of amendments and the subsequent delay in decision making
In his explanation, he believes that the adoption timeline may be stretched to the end of spring.
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