Just days after Russia’s digital currency industry’s future looked bleak following a proposed ban, the country’s Ministry of Finance has submitted digital currency regulatory framework proposals. As per local reports, the ministry believes that a total ban would lead to losses amounting to trillions of rubles and thinks implementing enabling regulations is the better approach.
As CoinGeek reported, the Central Bank of Russia recently proposed a blanket ban on the trading, issuing, and mining of digital currencies. It claimed that they have become a haven for illicit activities and posed a serious threat to Russia’s financial system.
The proposal was met with uproar from many in Russia and beyond. One of the factions that voiced its opposition to the proposal was the Ministry of Finance. Ivan Chebeskov, a senior official at the ministry, said, “We need to regulate, not ban [digital currencies].”
The ministry has now unveiled its regulatory proposals for the sector. According to a report by local media agency RBC, it had submitted the proposals to Dmitry Chernyshenko, deputy chairman of the government of the Russian Federation.
RBC reports that the ministry proposes that the digital currency sector be integrated into the financial services industry. With this, virtual asset service providers (VASPs) would have to adhere to more stringent regulations, including implementing measures that identify traders’ personal data.
The ministry further pointed out that the sector, which has been growing parabolically in Russia, can be a great source of revenue for the government. It will also enhance the government’s ability to track criminal activity.
This distinction is critical, especially at a time when most regulators have criticized digital currencies for harboring criminals and giving them anonymity. However, as Dr. Craig Wright has repeatedly pointed out, Bitcoin is private, not anonymous.
According to the Ministry of Finance’s estimates, about 2 trillion rubles have been invested in Russia’s digital currencies. In addition, the country is the second-largest block reward mining hub in the world after the United States.
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