Russia delays digital currency law amid coronavirus pandemic

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Russia is yet again delaying its long-awaited digital currency regulations, this time blaming the coronavirus. The law will lay some groundwork for the digital currency industry, including stipulations for their issue and circulation. It will however have to take a backseat as the country strives to fight off the pandemic.

The law on digital financial assets was slated to be passed by spring, allowing the country to finally get a handle on the industry. Anatoly Aksakov, the chair of the Financial Markets Committee in the State Duma explained that the State Duma fully agrees that the industry needs regulations, including defining digital currencies and the procedure for their issuance and circulation.

However, this will have to wait as there are more pressing matters for the country, key among them the coronavirus. The virus has now infected 2,337 people in Russia, with 17 deaths at press time, making it a more urgent issue for the country.

In an interview with Happy Coin News, Aksakov said that he believes the bill is overdue. Aksakov, who is the chairperson of the National Banking Council of the Bank of Russia stated:

“I would have liked for it to be accepted a year ago, as in my opinion, we were already ready for this then. This year, I hoped that we would take it in April, but because of the coronavirus, all processes slowed down, and the focus shifted to priority measures to combat the epidemic. It is assumed that before the end of the spring session we will finish the consideration of the law on digital financial assets.”

The legislator further revealed that one of the reasons for the delays in the past has been a disagreement between some state organs on the future of digital currencies. The Bank of Russia, for instance, has been advocating against these currencies, saying they pose a danger to the stability of the financial system. The State Duma, on its part, wants the country to allow some level of experimenting, such as with regulatory sandboxes.

The law, once passed, will bear good and bad tidings for the Russian digital currency enthusiasts. On the one hand, it will finally recognize digital currencies and give them a legal standing. This will make it easier for service providers to market their products as the citizens will be aware the government isn’t against them. On the other hand, it will bar the use of digital currencies as payment, which is crucial especially in the long term.

Despite all this, Aksakov assured the public that the bill won’t interfere with the running of digital currency exchanges. It will also not hinder transaction processing, with the lawmaker however revealing that mining will be considered an economic activity and will be liable to taxation.

As for a blockchain-based national digital currency, Aksakov doesn’t think it’s necessary yet, stating that the ruble is currently in a digital form as it is. He didn’t rule it out, however, and believes that once blockchain technology has stood the test of time, the Bank of Russia may issue a CBDC.