The Russian authorities have redefined regulations that involve imprisonment of people who fail to declare their holdings of digital assets. It is now mandatory for public officials to disclose their balance sheet of crypto assets otherwise they will have to face severe circumstances.
The current legal order is a part of the bill that was introduced in September 2020 involving strict criminal charges against people dealing with illegal activities linked with crypto assets.
Ministry of Finance
The Ministry of Finance has introduced various regulatory changes in the fields such as the Code of Administrative Offenses, anti-money laundering legislation, and Tax Code. The document reads, “Compliance with these recommendations will reduce the number of operations related to money laundering, obtained by criminal means.”
As per the Finance ministry, the major goal is to curb illegal activities related to cryptocurrency as the usage of crypto assets is increasing at an alarming rate. The FATF also outlines that cryptocurrency can be used easily in anonymous terrorism as it is difficult to trace the source of transactions.
With the new regulation on the part of the Ministry of Finance, if the total transactions of crypto assets become equal to 600 thousand rubles then they will have to report it to the concerned tax authority.
Besides individuals and organizations dealing with digital assets, miners and crypto exchangers are also obliged to report full data about the transactions done in cryptocurrency.
Fines and Imprisonment
The official document has also outlined a charge sheet if the entities fail to report information. If an individual fails to report tax authority, he will face a fine of 50,000 rubles. Similarly, in the case of “the provision of unlawful information,” the authorities will fine 10% of the total amount transacted via cryptocurrency. What’s more, the Russian authorities are now considering cryptocurrency a legal property like other properties that are vulnerable to legal victimization.
In other regions, such as European countries, there are no laws about cryptocurrency that may send you to jail.
The individuals, who are holding a public job, are required to unveil information about their crypto dealings if they want to be a public official. The government has given them a date of June 30, 2021, to comply with the new legal order.
The new law will create a further dramatic effect around cryptocurrency in Russia. The government will have to introduce a clear regulatory sandbox that is necessary for the future of crypto assets in the region.