According to the Reuters report, Russia’s finance ministry on Monday said it would take proposals on cryptocurrencies from the country’s central bank into account so long as they do not contradict its own approach, paving the way for legislation governing cryptocurrencies. A simmering dispute over cryptocurrency regulation in Russia heated up on Friday as the finance ministry submitted legislative proposals to the government that clashed with the central bank’s demand for a blanket ban on cryptocurrencies.
The Bank of Russia has proposed banning cryptocurrency trading and mining.
The Bank of Russia has proposed banning cryptocurrency trading and mining due to the threat cryptocurrencies pose to financial stability. But the Russian finance ministry prefers legislation that regulates cryptocurrencies, allowing them as an investment tool, but not as a means of payment. It said the finance ministry’s draft legislation aims to create a legal market for digital currencies on Monday. One proposal requires transactions involving the purchase or sale of cryptocurrency requiring customer identification.
One proposal requires foreign cryptocurrency exchanges to obtain a license.
Other proposals include foreign cryptocurrency exchanges obtaining a license in Russia and introducing financial literacy tests that determine how much individuals are permitted to invest. The finance ministry said that citizens who successfully pass the tests would be permitted to invest up to 600,000 roubles ($7,853) in cryptocurrencies each year. Those who fail would have an investment limit set at 50,000 roubles annually.
As reported earlier, the central bank also opposes cryptocurrency mining, whereby powerful computers compete against others hooked up to a global network to solve complex mathematical puzzles. The bank has warned of inefficient energy consumption and the environmental impact of the mining, while the finance ministry prefers to permit mining on a taxation basis.