A top Russian policymaker – the chairman of the State Duma’s finance committee Anatoly Aksakov – recently stated that Crypto Anonymity must end as it will help to stop terrorists and those looking to buy weapons illegally. He also said that those who own cryptocurrencies should be identified, as it would ensure that tokens are not used for financing terrorism or buying drugs and weapons illegally. The chairman labeled these acts as a possible reason to “finance terrorism and drug trafficking.”
He added: “Therefore, we must regulate the market and protect our citizens first and foremost. We must also establish a system of taxation as well as certain rights for cryptocurrency owners. However, they must be identified.”
The committee head stated that forcing people to declare their holdings would ensure that “among other things,” tokens would not be used to “finance terrorism, fund drug trafficking and used in the purchase of weapons.”
Aksakov noted that “big fluctuations” are commonplace in crypto, adding that “the price of a cryptoasset [frequently] moves by 20-30% in one direction or the other.”
However, much has been said about crypto in the world of Russian politics, but thus far very little has actually been done about it. To date, just one piece of crypto-related legislation has been promulgated: a decree outlawing the use of crypto in payments.
Legal definitions of cryptoassets, blockchain technology and crypto mining are still yet to materialize.
Late last month, the State Duma’s Vice Speaker Alexey Gordeev – the head of a joint government-Duma-Central Bank-crypto industry crypto working group – stated that creating legal terminology for the crypto sector would be the group’s primary target.
Crypto mining is another pressing matter in Russia, with energy providers concerned that miners are placing an inordinately high level of stress on their grids. The government has responded by allowing providers to identify suspected miners and charge them at higher rates accordingly.
Some miners have even welcomed the idea of legalizing their industry, even if it means they will have to pay tax on their earnings and pay higher electricity rates.
Aksakov also had words for the mining community, claiming that the industry “must be clearly defined.”
He stated: “If we allow mining, then it must be [regulated officially], it must be determined that this is a business that is included in the register of the Federal Tax Service. And the taxation of mining should be made legally explicit. In addition, [miners] should pay energy tariffs at business rates. These are not tariffs for the general population, they are rates for businesses.”
Despite Aksakov’s comments, no further progress on the matter is likely ahead of the working group’s next meeting – slated for some time next month. The group will need to navigate the impasse between the Central Bank, which favors an absolute ban on crypto-related activities, and big business representatives, who favor tokenization drives.
The chairman said that the working group (and its sub-groups) will still need to hammer out the legal status of cryptocurrencies before they can be deemed currencies or securities.
He also warned that there is still no consensus on the definition of cryptocurrency within the country, adding it should be defined as digital assets which are “protected by cryptographic methods.”