(Kitco News) – Russia’s State Duma has started work on a draft amendment to the Digital Financial Assets law in order to create a national crypto exchange, Russian media outlet Vedomosti reported Wednesday.
Lawmakers and market participants had meetings in mid-November to discuss what changes would be required to the law to enable the creation of a national exchange for cryptocurrencies, according to a source close to the State Duma, and the information was later confirmed by a participant in the meetings.
Representatives of Russia’s regulators, including the Ministry of Finance and the Central Bank, were not at the meetings. Instead, the plan is to first prepare a document that reflects the input of market participants, and then submit it for discussion to the government and the Bank of Russia.
Sergey Altukhov, a member of the Economic Policy Committee for United Russia, the party which supports President Vladimir Putin and holds 72% of the seats in the Duma, confirmed the plans.
“It makes no sense to pretend that cryptocurrencies do not exist, but the problem is that it circulates in a large stream outside of government regulation,” he said. “These are billions of rubles of lost budget revenues in the form of taxes.”
Altukhov said they need to create conditions for the legalization of cryptocurrencies and adjust the “rules of the game” so that they do not contradict the position of the Central Bank and the government. He said lawmakers are now discussing the exact formula of necessary steps and strengthening their arguments in preparation for the review of regulators.
Earlier this month, Russia’s Central Bank opened public consultations on stablecoins, NFTs and other tokenized financial instruments, signaling openness to the growth of crypto in the country.
But just three days later, on November 10, Russia’s Central Bank (CBR) Governor Elvira Nabiullina reiterated her hardline stance on cryptocurrencies in the country.
“Regarding crypto, we are in favor of the development of digital financial assets, and the digitalization of finance,” Nabiullina said. “But digital financial assets are not limited to crypto, to private cryptocurrencies. We have not changed our position that private cryptocurrencies – for which it is not clear who is responsible, or how responsible, which are opaque and carry high risks of volatility – should not be used in settlements.”
In April, the International Monetary Fund warned that Russia could use the crypto ecosystem to get around the Western sanctions that have been imposed on the country since it invaded Ukraine in February, including using its embargoed energy sector to mine Bitcoin and raise revenues.
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