Russia Decides to Legalize ‘Cryptocurrency payments’
Over 17.3 million people or 11.9% of Russia’s total population, estimated to own cryptocurrency at the moment. Yet, there has never been a pleasant relationship with Russia and the cryptocurrency market.
In fact, Russian President Vladimir Putin stated at the end of 2021 that it was “still premature” to adopt cryptocurrencies to facilitate the trading of energy commodities like oil and gas, despite other goverment officials was in favor of digital assets.
However, one of the first crypto-friendly moves by Russia was actually made in June of this year when the government authorized a draft law that may exclude issuers of digital assets and cryptocurrencies from value-added tax. The proposal in the document also suggested lowering the income tax rates (to 13%) related to transactions of digital assets.
Followed with another big announcement that Russia’s central bank agreed with the finance ministry to legalize the use of cryptocurrencies for cross-border payments, on September 5, 2022. The Central Bank of the Nation and the Ministry of Finance have acknowledged that, “it is difficult to operate without cross-border transactions in cryptocurrencies”, given the geopolitical environment at the moment.
The country’s deputy finance minister, Alexi Moiseev, states that a lot of Russians rely on foreign platforms to open a cryptocurrency wallet, and that this is something that should be conducted domestically using reliable platforms. Additionally, “It is necessary to do this in Russia, involving entities supervised by the central bank, which are obliged to comply with Anti-Money Laundering and Know Your Customer requirements,” Moiseev stated .
With this declaration, the nation’s view on adopting cryptocurrencies as payment has shifted and we can expect more appealing moves soon enough.
With a ratio rate of 17%, cryptocurrency is recognized as Russia’s fifth-most popular investing asset class, ahead of gold (16%) and stocks and shares (10%). As mentioned above, Russia could be the next crypto owners hub with almost 12% of its total population are owning crypto assets.
- Could this ‘crypto-friendly’ move by Russia be just to avoid sanctions after all?
- Will this impact to the long bearish market though? Especially, now we have the Ethereum Merge in next couple of days.
