Russia implements new cryptocurrency guidance for banks

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On the heels of increased regulatory oversight of the cryptocurrency space seen in countries around the world, Russia is now looking to implement additional guidance, as well. The country may still have a love-hate relationship with digital currencies, but this isn’t preventing it from wanting to ensure the activity doesn’t meet certain standards, and banks could soon be given a new framework with which to oversee crypto transaction activity. The proposed framework, drafted by the country’s central bank, would make it easier for banks to govern the Bitcoin space and market participants.

The guidelines aren’t completely new to Russia; they’re a variation of existing anti-money-laundering protocols that have been adopted to cover digital assets. According to local media outlet RBC, the updated protocols include 100 different points that banks can use to determine whether or not a crypto transaction could be considered suspicious. They also allow the financial institutions to place complete bans on asset holders and to block transactions or close accounts if they’re deemed to be operating outside the framework.

The new regulations have to be approved by legislators before being given complete approval, but they’re a step forward. According to a representative of the central bank, the 100 points do not cover all potential scenarios, and he adds, “Credit organizations have the right to supplement it with their own criteria specific to them, taking into account the scale, specificity and nature of the credit institution, the nature of transactions performed by customers and the level of legalization risk associated with them (money laundering).”

A couple of years ago, it seemed that crypto was on its way to being accepted in Russia and even the country’s president, Vladimir Putin, had ordered legislators to create the necessary framework toward their legitimization. However, just like in certain other countries, Russia decided that the risks of the currency being used for illicit activity were too great, and efforts to move the industry forward have stalled.

The new guidance is meant, in part, to reduce those risks. It was prepared with assistance from Russia’s Federal Service for Financial Monitoring in an effort to “add new schemes of conducting unusual operations, with consideration to the modern developments in financial markets.” As a result, the framework would give banks a legal foundation to react if they suspect foul play. This also means that, in some circumstances, even buying or selling crypto could be seen as a money-laundering risk, depending on the bank’s interpretation, leading to asset seizure.