Russian President Vladimir Putin just signed into law a national ban on crypto payments in Russia!
Find out what’s going on, and what it means for cryptocurrencies in Russia!
Putin Signs Law Banning Crypto Payments In Russia!
On July 16, 2022, Russian President Vladimir Putin just signed into law a national ban on crypto payments in Russia.
This move comes after the Central Bank of Russia proposed an outright ban on using cryptocurrencies for payments or investments.
This ban does not go so far – it only bans payments using cryptocurrencies, while allowing people to continue investing in cryptocurrencies like Bitcoin and Ethereal, as well as digital assets like NFTs.
The new Russian law, as translated by Google, states that :
While it prohibits individuals and companies from paying for, and receiving, cryptocurrencies for goods and services, it allows the Russian government to use cryptocurrencies.
It also does not prohibit investing in cryptocurrencies or digital assets like NFT, leaving that open for now.
Partial Crypto Ban Reflects A Russia In Quandary
This partial ban on cryptocurrency reflects Russia’s precarious financial situation after invading Ukraine on February 24, 2022.
The Russian government had, prior to that, been skeptical, if not hostile, about cryptocurrency. But US and European sanctions are forcing them to hold back.
The lower house of the Federal Assembly of Russia, for example, just approved a draft bill on June 28 that would exempt cryptocurrency issuers from the Value Added Tax (VAT).
If passed by the upper house and signed into law by Putin, the lower house bill would also lower tax rates on income earned from selling cryptocurrencies – falling from 20% to just 13% for Russian companies, and 15% for foreign companies.
More recently, the Head of Russia’s Financial Policy Department even suggested that Russia could use cryptocurrencies to settle international payments.
Even Putin himself said that Russia had “certain competitive advantages” including a “surplus of electricity and well-trained personnel” to participate in crypto-mining, even though he is against using cryptocurrencies domestically.
If the Russian government chooses this path, it would be considered hypocritical in light of this ban on crypto payments in Russia. Cryptocurrencies are bad for the people, but good for the Russian government.
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