New legislation would allow Russia to issue invoices in crypto to legal entities for international transactions.
Russia plans to legalize crypto invoices
Over the past few months, in addition to making a name for itself in Eastern Europe, Russia has taken the opportunity to regulate its relationship with cryptocurrencies.
The work is not yet finished and the legislation in this area needs to be improved, which is where the Russian Ministry of Finance’s recent bill comes in.
According to the amendment made by the Ministry of Finance in team with the Ministry of Economy, Digital Development, Internal Affairs, Federal Tax Service and Russian Financial Control, the aim is to legalize cryptocurrency invoices between legal entities for international transactions.
In a world trying to push the Kremlin further and further to the sidelines with international sanctions, the government intends to untie the strings by opening itself up to the international community with new instruments.
Invoices in crypto go in an externally oriented direction and compensate for the restrictions due to sanctions over the war in Ukraine.
However, there is no consensus that this is the right direction to take. The Russian Central Bank, in fact, believes that crypto can be an excellent investment, but does not look favourably on their use for transactions.
The viewpoint of the Central Bank of Russia has been known for a long time and has never changed on this issue. This is why any opening of Russia to digital currencies takes on great value.
The law on cryptocurrencies has been in the works since February 2022 and, although it sanctions their recognition as an investment asset, it expressly forbids their use as a means of payment, or at least until now.
What does the new bill envisage?
According to a leaked report by the Interfax news agency, this turnaround on the possibility of paying with digital currencies would have taken place mainly to counter the limited scope for Russian entrepreneurs with regard to foreign transactions. In essence, it was decided to provide an alternative to circumvent the sanctions imposed by the United States, Europe and Great Britain.
The novelties included in the new bill do not end there: privacy and restrictions have also been addressed.
Crypto trading platforms that are not authorized to operate from Moscow will not be allowed to be marketed. In addition, authorized transactions, user information and sensitive data will be stored for a period of three years, with the possibility of access to them by Russian law enforcement agencies.
Users will be able to buy and sell cryptocurrencies only if they conduct transactions through Russian accounts and if their digital identity is recognized by the Moscow control system.