Russia is planning to create a national cryptocurrency exchange because it believes it is losing out on billions of rubles of tax revenue.
Sergei Altukhov, a member of the State Duma economic policy committee, said cryptocurrencies “circulate in a large stream outside government regulation.”
Plan to Track all Crypto Transactions
Last month, the Russian Ministry of Finance noted that Russian companies doing business within the Russian Federation have started using cryptocurrencies to get around restrictions on international trade.
The Russian government has been planning and establishing legal specifications for international cryptocurrency transactions for months in anticipation. Although the government of the Russian Federation itself has been pushing for the digital ruble over private cryptocurrencies.
With the new draft framework, legal rules will oversee the use of digital assets in Russia. Reports last month said that direct exchanges are taking place on Russian streets to convert crypto into fiat amid a cash shortage.
It turns out that stablecoins, despite EU attempts to limit Russian access to cryptocurrencies, for many remain a real substitute for the currency. Russian citizens are showing interest in the new financial instrument. And, exchange offices have appeared on the streets of Russian cities where transactions using digital assets can be carried out.
With limits imposed on bank withdrawals, citizens have resorted to alternative methods to meet the demand. Street traders are willing to buy USDT in exchange for dollars in cash, despite the apparent shortage of the latter in the country.
Miners Can Use Exchanges
According to an official, the committee is discussing the regulation scheme and “reinforced concrete arguments for supervisory authorities.” Sources cited in the report say the crypto exchange will not promote the use of digital currencies in Russia.
Another draft amendment on Digital Financial Assets prohibits the advertising and circulation of digital assets in the Russian Federation. However, the same draft legalizes the mining of digital currency in Russia.
Therefore, the exchange will be only used to declare and convert digital currencies. A step that will benefit Russia’s economy, which international sanctions have crippled. Russia is seeking to avoid penalties by legalizing cryptocurrency cross-border settlements through expanding mining operations. At the same time, it plans to boost taxation revenue from Russian wallets.