A platform for public discussion of the regulation of cryptocurrencies and digital assets has been created in Russia

The Commission on Blockchain Technologies and the Digital Economy under the Investment Russia public organization, the Digital Rights Center Law Firm and RosKomSvoboda are launching a public campaign demanding to prevent the adoption of laws that impede the circulation of cryptocurrencies and digital assets in Russia.

The collection of initiatives for the balanced regulation of the circulation of cryptocurrencies and digital assets will be held on the zakon.crypto.ru platform.

The initiative’s website contains a petition addressed to the Ministry of Finance of the Russian Federation, the Ministry of Economic Development of the Russian Federation, the Central Bank of the Russian Federation, the Federal Tax Service of the Russian Federation and the Financial Market Committee of the State Duma of the Russian Federation. The authors of the petition ask government bodies to prevent the adoption of bills that will have an extremely negative impact on the cryptoindustry in Russia, as well as to amend Federal Law 259-FZ “On digital financial assets and digital currencies” in order to bring it into line with the prevailing practices and interests of the cryptoindustry … The petition can be additionally signed on the Change.org portal.

On January 1, 2021, Federal Law No. 259-FZ “On digital financial assets, digital currency and on amendments to certain legislative acts of the Russian Federation” came into force. The law regulates relations related to the issue, accounting and circulation of digital financial assets and establishes a number of important definitions: “digital financial assets” (DFA), “digital currencies”, “operator of the information system in which digital financial assets are issued” and “operator exchange of digital financial assets “.

Four bills supplementing the law and introducing additional regulation are currently under consideration by the State Duma and / or are undergoing a regulatory impact assessment (RIA) procedure at the Ministry of Economic Development. The bills propose amendments to the Tax Code, the Law on Counteracting Legalization (Laundering) of Criminally Obtained Incomes and Financing of Terrorism, Administrative, Criminal and Criminal Procedure Codes of the Russian Federation.

Sarkis Darbinyan, co-founder of RosKomSvoboda:

“For several years we have been promised that a cryptory will be created in Russia for investors and projects working in the field of distributed technologies. However, the approach that has been recently developed by the state clearly does not suit either the domestic professional crypto community, or the global crypto business, or “ordinary” users of cryptocurrencies. After many years of discussions about the legal nature of cryptocurrencies, the legislator nevertheless defined in the “law on CFA” that cryptocurrency (or, in the language of the legislator, digital currency) is property. At the same time, an extremely controversial legal protection model was chosen for property, which guarantees judicial protection to the owners of digital currencies solely under the condition of their declaration, which directly violates the right to judicial protection guaranteed by Article 46 of the Constitution of the Russian Federation. The law in its current edition creates only obligations for market participants, but does not establish any rights or benefits for them. At the same time, the bills, the adoption of which is not far off, provide for completely inadequate measures of administrative and criminal liability for users of digital currencies. The crypto market is already feeling a clear imbalance, and if the bills are adopted in the form in which they were presented to us, this will further slow down this innovative industry. ”

The platform lists eight major flaws in the current legislative approach to regulating the crypto industry in Russia. The experts and authors of the petition believe that:

• The existing and proposed legislative regulation is not sufficiently developed from a legal point of view and generates legal uncertainty. It does not take into account the established world practice and experience of regulating the cryptoindustry in other jurisdictions;

• Legal protection is available to holders of digital currencies only after declaration, which constitutes a violation of the constitutional right to judicial protection;

• Digital currencies cannot be used as payment for goods, work and services, which is contrary to the nature and purpose of cryptocurrencies as a means of payment;

• The amendments under consideration to the Code of Administrative Offenses of the Russian Federation provide for the introduction of unreasonably large fines for violations related to the circulation of digital financial assets and digital currencies;

• The amendments under consideration to the Criminal Code of the Russian Federation provide for punishment in the form of imprisonment for up to 3 years only for failure to submit reports to the tax authorities of the Russian Federation;

• The threshold for compulsory declaration of transactions with digital currencies and filing reports is unreasonably low;

• The complete absence of any benefits, including tax ones, for the crypto business.

Mikhail Tretyak, partner of the law firm Digital Rights Center:

“We do not propose to criticize the legislator – we propose to establish a constructive dialogue with the state in order to jointly develop a regulation that will suit all links in the chain“ state – citizens – business ”. The initiative, thus, is aimed at achieving a balance of all parties, without “distortions” in one direction or another, and softening regulation for the sustainable development of the cryptoindustry in Russia. We believe that this initiative will meet with understanding of the authorities, and together we can change the regulation for the better.

Also, we do not plan to dwell only on legislative changes. We offer the government to work together to improve the financial literacy of citizens when working with digital assets and digital currencies. It seems that together we will be able to launch a series of educational programs for all interested parties. This will not only prevent the noticeably increased incidence of fraud, but will also allow citizens to make informed decisions regarding the use of digital currencies. ”

Nikolay Gadzhiev, Chairman of the Commission on Blockchain and Digital Economy of the All-Russian public organization Investment Russia:

“The creation of a public initiative is an important step towards creating a dialogue between the state, on the one hand, and the Russian blockchain community, Russian and international companies, on the other. The existence of a dialogue is extremely important for the formation of a sustainable financial and legal field in Russia, which will create conditions for the most effective development of the blockchain sector in the digital economy in Russia. Our country has endless opportunities and unique specialists, with the existence of a two-way dialogue with the state, this will allow Russia to become the dominant leader in the blockchain field for many decades, opening new horizons for the Russian economy. ”