Russia takes Security Token Offerings and attempts to pave the way to establishing Crypto legislation. Central Bank not fully on board with the new bills.
Russian government is on its way to creating regulatory framework for security tokens. Moscow has always been a bit indecisive towards the technology. This attitude had backlash in the Blockchain community and the adoption didn’t quite happen.
Lawmakers in Russia realized the importance of establishing legislation for the use and ownership of digital assets. This is a way to give those using such assets to compete head first on the global stage. These ambitions are related to the “Open Russian Digital Economy” campaign which is going to help Russian development of alternative sources of finance through inviting. There are three Crypto bills coming into force next months.
Those bills somehow fail to address the Cryptocurrency regulations topic directly. They only scratch the surface, covering basic Crypto activities, with the third one barely touching Cryptocurrencies in general. The latter bill, titled “On Digital Financial Rights” has been delayed three times already. For the Crypto community it is considered to be the most important one. It breaks the assets into three categories – Virtual Assets, Technical, and Digital Financial Assets. This is a good step towards adoption and confidence. After a couple of amendments, The Chairman of Russia’s Financial Market Committee Anatoly Aksakov showed the first two drafts of the bill on 20th March 2019. On 26th March, the Smart Contracts Bill filled by Pavel Krasheninnikov went in for the lawmakers. Krashneninnikov stated that those contracts are close to the payments systems in place right now. In his opinion, FinTech is necessary in the growth of the Russian digital economy.
The problem with the Central Bank, also known as the Bank of Russia, not surprisingly, is that it doesn’t approve the legalization of digital assets. Its deputy governor Sergei Shevtsov called the Cryptocurrencies a “high-tech pyramid scheme”.
The second piece of legislation “On Digital Rights” went into full speed. This one doesn’t mention the term “Cryptocurrencies”, although it sets a number of legal definitions and legalizes the term “digital rights” in The Russian Federation.
The third Crypto bill becomes enacted into law in January 2020 and gets to the topic of Security Token Offerings (STO). It goes by the name of “On Attracting Investment Using Investment Platforms”. The bill was signed by Vladimir Putin in August 2019 with a new law that prevents losses for inexperienced investors. They can only invest up to 600,000 rubles which is around $9,000 per individual. There are also restrictions in the ICO and STO fields.
This bill restricts firms, not registered with the Central Bank, from hosting crowdfunding events.
Russia’s efforts to utilize the Blockchain sector go as far as allowing the elite to participate freely in it. Being an average Russian Crypto investor may not be so easy after all but it may be worth it. Following the Blockchain expansion, the country founded the Russian Association of Blockchain and Cryptocurrency. The association helps investors to better validate ICOs and STOs with the ambition to come up with an international standard for crowdfunding.
Promoting Blockchain environment is a big step for Russia towards the Cryptocurrency adoption, given the fact there will be a Russian native Crypto in store next year.