Bitcoin to be Declared Legal in Russia

Looks like things are changing fast in Russia, where only a year ago their Finance Ministry was threatening jail time to anyone using digital currencies. But in a major U-turn, it’s now edging closer to their acceptance as a legitimate financial instrument to open a new line of attack on money laundering.

Russian authorities have recognized the increasing popularity of Bitcoin and also its potential to solve a wide range of issues plaguing their current financial system. The country which has been against the use of cryptocurrency for transactions within the country is now planning to assign a regulated status to the digital currency to pave the way for a more structured crypto-ecosystem in the country.

Russia’s move to recognize the legitimacy of the cryptocurrency as a currency closely follows the very recent developments in Japan where cryptocurrencies are now legal mode of payments. Assigning a regulation to Bitcoin as a currency not only makes it much easier for the community members to use it for a wide range of applications, including payments for their daily needs, it also brings in more liability, opening doors for newer regulations governing the use of Bitcoin in the country.

Russian authorities hope to recognize bitcoin and other cryptocurrencies next year in 2018 as they try to enforce rules against illegal transfers, said Deputy Finance Minister Alexey Moiseev in an interview. Russia’s central bank is developing a common position together with the government on digital currencies, according to its press service.

“The state needs to know who at every moment of time stands on both sides of the financial chain,” Moiseev said. “If there’s a transaction, the people who facilitate it should understand from whom they bought and to whom they were selling, just like with bank operations.”

The government’s perception to monitor all transactions and parties to these transactions seems a bit overreaching and with various blockchain analysis tools available, it has become quite easy to do so. The regulatory bodies and the financial governance are expected to take this decision regarding Bitcoin’s legal status in the next few months. Once the decision is finalized, all the concerned departments and ministries will start drafting new regulations and compliance requirements for Bitcoin platforms and the cryptocurrency community.