A draft law that seeks to safeguard the rights of owners of cryptocurrencies, while also regulating their use for payments, has been introduced in Russia’s parliament.
The bill sets clear definitions for terms such as “digital money” and “digital rights.” It also lets authorities subject cryptos to taxation, inheritance rights, and bankruptcy claims.
The law modifies Russia’s Civil Code to make a basis for “legal relations in the digital economy.” The draft is co-sponsored by the Speaker of State Duma, Vyacheslav Volodin, and the head of the parliamentary Legislation Committee, Pavel Krasheninnikov. Their initiative legalizes financial transactions in the digital environment.
Bill №424632-7 has been filed after the introduction of bill №419059-7, which was prepared by the Finance Ministry. In its most recent version, the law “On Digital Financial Assets” regulates initial coin offerings and crypto mining, but bars cryptocurrencies, says its critics. The fate of cryptos, like bitcoin, would be decided by the Central Bank of Russia (CBR), which has consitently opposed their circulation and exchange in the country.
In the new legislation, cryptocurrencies are deemed as “digital money.” According its authors, it’s crucial to legally define cryptos and other “digital” terms to make sure that the legal rights of those dabbling in virtual transactions are protected. The draft reads that their acceptance for payments, deposits, transfers and as units of account would not be necessary in the Russian Federation. However, it also makes way for the use of cryptocurrencies as means of payment when that’s technically possible and risks are excluded.
“In perspective, digital money will be used as a payment instrument, but only in cases and on terms established by the law,” said Krasheninnikov. Quantities will be controlled and users’ information will be gathered. Lawmakers say this would let officials keep track of cryptocurrencies in cases of bankruptcy and also apply inheritance rights.
The legislation is set to facilitate digital transactions such as smart contracts. Digital confirmations would be just as acceptable as written statements and signatures. The regulation of digital rights generates a basis for a taxation mechanism in the virtual space. It also makes way for the application of measures to keep the laundering of funds that was claimed through illicit transactions.
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