The Central Bank of Russia will limit the unqualified purchase of cryptocurrencies
From the very beginning, the Central Bank of the Russian Federation was quite strict about the use of crypts, and its unqualified purchase or illegal possession was considered very strictly.
Unqualified purchase of cryptocurrency in Russia is questionable
With the recent introduction of digital assets into Russian law, which legalized cryptocurrencies as a type of taxable property (starting in January 2021), financial authorities have proposed strict laws regarding digital financial assets.
The country’s Finance Ministry is keen to stick to harsh punishments and criminal charges for hiding crypto assets. Since cryptocurrency is not currently legalized as a payment method, a violation can lead to serious lawsuits.
The tax authorities will closely monitor all purchases and any suspicious transactions. If the fact of concealment is discovered, it can lead to unpleasant consequences.
The monetary regulator, I.e. the Central Bank of Russia, is now seeking to restrict unqualified purchases of cryptocurrencies. Purchases worth more than 600 thousand rubles a year will be prohibited. The Directive is intended specifically for unqualified investors, and although it is under public discussion until October 27, it is expected to come into force by January 2021 if approved.
To be considered a professional investor, an individual must meet the following five requirements:
- Have a net worth of at least 6 million rubles (us $ 7800);
- Own securities totaling more than 7800 dollars;
- Have a higher economic education;
- Frequently trade large volumes of securities;
- Have at least two years of experience in a financial institution.
Currently, there are no offers for qualified investors, and they are open to digital investments in accordance with foreign legislation. But…
Binance, the world’s largest cryptocurrency exchange, offered detailed information about the purchase of cryptocurrency products for investors in the Russian Federation, which was negatively evaluated by censorship, after which the crypto exchange was blacklisted.
Strict rules are the main reason why FINTECH races are lost
Regulations that aim to restrict activities do not help crypto-currencies and the FINTECH industry. Let’s take an example of what this policy leads to in the United States of America.
Dan Tapiero, one of the founders of the well-known investment company 10T Holdings, said that US regulations are undermining the growth of the financial technology industry.
Tapiero quoted former Ripple CEO Chris Larsen, who previously described how unfavorable government policies could make his organization and others think about moving to other countries. Tapiero said that industry players may be forced to leave the States if the rules are not improved.
Brad Garlinghouse, CEO of Ripples, also tweeted about his concerns about hostile US regulations that have made it difficult for most market participants to work in the industry.
What the future holds for cryptocurrency
At the moment, you should keep up with other global players, and instead do the exact opposite with numerous rules. Such regulations and policies have led to China dominating the crypto mining industry, with more than 60% of all mining occurring in the Asian country.
In addition, it may result in the fact that many companies will withdraw their business from the legal field of Russia, to more loyal jurisdictions, which will entail multibillion-dollar losses for the economy.