According to the local media outlet RBK, Russia’s Ministry of Finance has prepared a new version of Russia’s laws that introduce stringent measures regarding the usage of crypto wallets. The announcement follows an earlier attempt to prohibit crypto transactions in Russia. However, the report stated that this new amendment would come into force in January 2021. According to the new laws, crypto users in Russia have to report their wallet address and its transaction history to Russian tax authorities if the wallet turnover crosses 100,000 rubles ($1,300) in one year.
Crypto users might face prison time for up to three years for not complying.
If crypto users do not comply with the regulations, they might face imprisonment for up to three years, and in the case of crypto crimes, the new law would charge users with severe punishment. The law also addressed over-the-counter (OTC) cryptocurrency dealers who also have to report all transactions involving rubles and Russian IP addresses to the tax authorities, the report revealed. According to financial regulators, these latest regulations would help them curb illegal activities and offenses related to cryptocurrency, as officials claimed that digital currencies were most often used for tax evasion and money laundering.
Russia witnessed a surge in crypto adoption this year.
According to new research from the blockchain analytical company Chainalyisis, Ukraine and Russia lead in the crypto adoption worldwide. The Index looked at three on-chain metrics, including the total value of on-chain crypto transactions weighted by purchasing power per capita (PPP), the value of on-chain retail transfers weighted by PPP, and the number of on-chain crypto deposits weighted by the number of internet users.
As reported earlier, the previous draft bill on digital assets sought harsh punishment for facilitating crypto transactions in Russia, including prison time of up to seven years.