Russia's plan to regulate cryptocurrencies and initial coin offerings lead to the first draft of the federal law "On Digital Financial Assets".
According to translated documents, the law stated:
This federal law regulates the relations arising in the creation, issuance, storage and circulation of digital financial assets, as well as the exercise of rights and performance of obligations under smart contracts.
The draft also described cryptocurrencies, tokens and mining, as well as legalizing the act of mining. In a meeting held by the Ministry of Economic Development on Feb. 27, members have now proposed additions to the draft.
According to Russian news outlet Vedomosti, members requested that transactional profits, as well as personal income, from cryptocurrencies should not be taxed. Furthermore, investment limit in ICOs should be increased from 50,000 to 500,000 rubles. Russian token holders should be allowed to invest in other tokens and participate in foreign exchanges. Lastly, members also proposed dropping the restrictions posed on non-residents for participating in ICOs.
Officials from the Ministry of Communications, Ministry of Justice, Central Bank of Russia, Federal Antimonopoly Service (FAS), Sberbank of Russia, MTS, Skolkovo Foundation, Gazprombank, Qiwi, and other companies were present at the gathering. However, representatives from the Ministry of Finance were absent since they are not a part of the "working group".
The new proposal cuts down on the stricter rules favored by the Deputy Finance Minister Alexei Moiseev. He said, "Introducing tax exemptions is expedient, but the idea to increase the limit for individual investments in ICOs is debatable and we can discuss it."
Even Russia's presidential candidate, Boris Titov, believes that the original draft is inflexible, "The Finance Ministry’s proposals present a much tougher regulation than in Japan, Switzerland, Belarus, Armenia. That is, in all countries that have adopted some form of legislation. It would be better not to adopt anything than to adopt such legislation."
Amidst Russian Orthodox Bishop Hilarion's controversial views on cryptocurrency and President Vladimir Putin emphasizing blockchain's importance in the country, Russia plans to finalize cryptocurrency legislation by Jul. 1, 2018. However, the central bank is still hesitant on allowing cryptocurrency trading as explained by the chairman of State Duma Committee for Financial Markets, Anatoly Aksakov, "The central bank is against the legalization of this type of digital currency, since in this case, citizens can start actively investing in crypto-tools, not taking into account possible risks."
Featured image from Shutterstock.