Russia's Bitcoin Ban May Be Submitted to State Duma by August

Russia’s Ministry of Finance has long taken a tough stance on Bitcoin and other digital currencies, which are viewed by regulators as alternatives to the ruble.

The draft bill, which calls for criminalizing bitcoin trading, will be submitted to the State Duma — the lower house of Russia’s Federal Assembly — before the end of its August session, the deputy finance minister said.

According to a recent report by Russian publication RIA Novosti, Russia’s Deputy Finance Minister Alexei Moiseev wants to introduce a law that would make bitcoin traders aware of the legal responsibilities they face when exchanging bitcoin for rubles or vice versa.

The spring session ends on August 6, and it is noteworthy that Moiseev intends to pass the bill through the Duma before then.

The report quotes Moiseev as saying:

We hope to accomplish this (through a bill to outlaw Bitcoin) in a short period of time.

I think we will be able to present the approved proposals to everyone before the end of the spring meeting, but it is still uncertain whether they can be implemented immediately.

The news comes after a recent report was released confirming the Russian Finance Ministry’s recommendation to ban digital cryptocurrencies.

The draft bill to ban Bitcoin has reached its final version, calling for the Russian government constitution to make a legal provision that stipulates that the ruble is the sole monetary unit of the Russian Federation. The draft bill has already sparked heated public debate.

For example, Article 75 reads as follows:

The ruble is the monetary unit of the Russian Federation, and the Central Bank is the only currency issuing institution. The introduction and issuance of any currency other than the ruble is prohibited in the Russian Federation.

Moiseev said the reason for calling for criminal liability for digital currency traders is that cryptocurrencies are suspected of being involved in terrorist financing and money laundering.

He explained:

These crimes would not have been possible without the collusion of a large number of bank insiders. Although corruption still exists in the banking system, this will be the first time that terrorism and money laundering will be fought head-on.

In addition, the proposal also recommends a prison sentence of up to seven years and a fine of 2.5 million rubles for those involved in trading and mining Bitcoin.