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Cryptocurrencies

Russian lawmakers submit Bitcoin banning bill

Monday 11 January 2016 | 12:46 PM CET

Russian lawmakers have submitted a new draft bill to the Duma that would effectively ban the use of digital currencies domestically.

The development may not be surprising to industry observers, as talks of a Bitcoin ban in Russia have been rife in the news for over a year amid broader concerns of capital flight. However, the latest bill is perhaps the most concrete step taken by government officials to date to crack down on the emerging technology's expansion.

The Russian Ministry of Finance, which oversees policy and legislation for the industry, has repeatedly indicated its opposition against allowing the use of digital currencies as an alternative to government-issued money, although they have clarified that blockchain applications of the technology are not viewed so harshly.

A translation of the new Russian-language draft includes several clauses that would effectively make many uses of digital currencies liable for severe administrative penalties. These would range from USD 265 to a maximum of USD 66,264, along with confiscation of the items responsible for the violation.

The level of fine would depend on the type of violation and the status of the party responsible, increasing through individual, entrepreneur, Russian official and legal entity.

Elsewhere in the text, a number of other important potential areas of digital currency use are identified. For example, penalties would be handed out to those who pay for goods with money surrogates rather than an approved, government-issued currency.

The clause "Assistance in money surrogates circulation" would seek to ban the creation or distribution software that facilitates the issuance of money surrogates.

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