A move that heralds a shift in how cryptocurrencies and blockchain-based payments are carried out in the country was announced by Russian President Vladimir Putin last week, which imposed a ban on all digital payments in the country. The move prohibits digital securities and utility tokens from being used as a payment method. The bill bans the use of digital assets, such as cryptocurrencies and NFTs, to pay for goods and services. How smart money is playing the game of criptocurrency.
It is forbidden to transfer or accept digital assets as a consideration for transferred goods, performed works, rendered services, as well as in any other way that allows one to assume payment for goods works, services by a digital financial asset, except as otherwise provided by federal laws, the law reads.
Users can still purchase cryptocurrencies in Russia, but the change means that they can't use the digital currency to pay for services or products.
The law extends the 2020 digital assets law in Russia that prohibits using cryptocurrencies as a payment method.
In January, Putin boasted about Russia's competitive advantages in the cripto industry, referring to the country's energy surplus and well-trained personnel that carry out Bitcoin mining. A month later, the Ministry of Finance unveiled a bill that provides a framework for cryptocurrencies regulation. Despite the pro-crypto stance of the government, the Bank of Russia has maintained a defiant anti-crypto attitude, clamoring for its outright ban.
Russia's invasion of Ukraine in February caused an exodus of companies from the federation that were not affected by the sanctions-battered federation. Some of the world's largest cripto exchanges, including Binance and Coinbase, have banned Russian customers from using their services to comply with new American and European rules.
The Ukraine war has spawned outside concern about how Russia might use cryptocurrencies as a tool to evade sanctions.