Russia plans to legalize Bitcoin, but government will collect transaction data

The Russian government reportedly plans to define Bitcoin as a financial instrument in 2018.

Senior Russian officials, including Deputy Finance Minister Alexey Moiseev and several representatives of the central bank, are currently working on a legal definition of Bitcoin and digital currencies aimed at reducing money laundering risks, Bloomberg reported.

It is reported that Moiseev said that the government hopes to obtain information about relevant transaction parties, and Russian digital currency payment service providers may also need to collect and submit transaction data.

He said:

We must know the identities of the traders at both ends of this financial chain at all times. In a transaction, the participants must clearly know the identities of the buyer and seller, just like how banks operate.

It is not clear what decision Russia will ultimately make, but judging from the country’s past attitude, they have gradually relaxed their management of this technology.

In 2015, the Russian government proposed that those who use or create digital currencies should pay heavy fines. The corresponding penalties were even strengthened in a draft bill released the same year.

However, in August last year, Moiseev said Russia could define Bitcoin as a foreign currency. Since then, senior officials have stopped proposing harsh penalties for Bitcoin transactions.