Updated law could make cryptocurrencies a means of international payments. RBC-Crypto understood the intricacies of the process
From September 1, the Bank of Russia may begin creating an experimental platform for the use of cryptocurrencies in international payments. The Central Bank will coordinate certain steps to establish an experimental regime with Rosfinmonitoring, the Ministry of Finance and the FSB.
The corresponding amendments were made to the bill on cryptocurrencies by State Duma deputies; the text of the new version of the bill (No. 341257-8) was published on April 22. In its previous version, a single experiment on external settlements in both cryptocurrency and digital financial assets (DFAs) was implied, but later settlements in DFAs were included in a separate law, adopted at the end of February.
Experts told RBC-Crypto about new provisions and prospects for the use of cryptocurrencies in foreign economic activity.
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What was added to the bill
The presented bill is a revised legislative initiative, which was published a year ago, and the essence of which boils down to the possibility of using cryptocurrencies in foreign trade, explains Fyodor Ivanov, director of analytics at Shard.. DFAs were excluded from the new text — their use for foreign economic activity purposes is already carried out in accordance with the amendments made by Federal Law 45 of March 11, 2024, and now deputies have focused on cryptocurrencies and mining.
Otherwise, the draft law differs little from the previous ones, adds Ivanov. The Central Bank will establish an experimental legal regime (EPR), under the terms of which changes will be made to the operation of several laws — on currency regulation, on DFA and on combating money laundering.
In the context of increasing sanctions pressure on Russia, we received “conditional permission” from the Bank of Russia to use cryptocurrency for foreign economic activity, comments the founder of the law firm GMT Legal Andrey Tugarin. The market for cross-border payments using cryptocurrency, according to him, is already operating in Russia and requires regulation and rules. But it’s too early to talk about its effectiveness just based on the text of the bill.. The whole essence and details will appear when the provisions of the EPR program appear, the lawyer believes. After this, it will be possible to talk about effectiveness.
“The bill does not contain the most interesting thing — the parameters of the future EPR,” agrees Ivanov. — They will be installed by the Central Bank in agreement with Rosfinmonitoring, the FSB and the Ministry of Finance. Therefore, we will find out how it will work later.». The effectiveness of the EPR will be directly affected by the conditions and rules that the Central Bank will establish. If this ultimately results in a centralized sandbox, then “the fate of the whole story is questionable.”
Sanctions and risks
“The bill gives rise to mixed feelings. On the one hand, we are pleased with the state’s next step towards settlements in cryptocurrencies in the legal field. On the other hand, any centralized and regulated platforms, platforms, exchanges through which payments are made in cryptocurrency with the outside world, not only do not solve the problem of cross-border payments, but aggravate it,” says Dmitry Kirillov, a teacher at the educational platform Moscow Digital School and advisor to Lidings.
The world has adopted the practice of marking crypto wallets and individual coins for the purposes of sanctions and anti-money laundering legislation. As soon as the cryptocurrency goes abroad through such a platform, it will immediately be labeled as related to Russia, and the platform itself will fall under sanctions, Kirillov is sure.
At the end of March, the US Treasury Department's Office of Foreign Assets Control (OFAC) imposed sanctions against Russian companies working with digital assets. Among them were both well-known DFA issuers and the B-Crypto company, an operator of cross-border settlements for foreign economic activities.. In the summer of 2023, Rosbank developed solutions for cross-border payments in cryptocurrency in accordance with legal requirements and restrictions of the Central Bank. It was B-Crypto that provided technical support for the bank.
The use of cryptocurrency in cross-border settlements in the EPR mode can partially solve the problems with cross-border settlements, but at the same time it increases the risks of secondary sanctions, as happened with the CFA, lawyer and Moscow Digital School expert Maria Telegina agrees with the previous commentator. The disadvantage of the proposed model, in her opinion, is the “excessive regulation” of the payment process itself. To what extent this approach will help solve the problem with sanctions and protect Russian partners from the imposition of sanctions on them is still “difficult to assess,” Telegina believes. Also, this approach will limit those payments in cryptocurrency that were made successfully before the introduction of regulation, since they were “made with a certain degree of privacy.”
“All this has been working for several years now.. Several companies that officially work in this area have already been included in the American sanctions lists and so far, apparently, there are no threats to the Russian economy from such activities; rather, on the contrary,” adds Ivanov.
It is not yet entirely clear how to use DFA platforms for foreign trade purposes, especially when the largest of them are also under sanctions. The Central Bank needs to attend to the issue of diversifying EPR participants, as well as reducing the risks of illegal withdrawal of capital and laundering criminal proceeds, control mechanisms, including over crypto transactions, independent of foreign vendors, the expert believes.
“It’s not clear where to get liquidity. It is not clear from the bill what will push Russian miners, for example, to sell cryptocurrency for rubles in the absence of regulation of this activity in general,” continues Ivanov.
In February, during the RBC-Crypto forum “Mining and Cryptocurrencies: Architecture of Growth,” Director of the Industrial Mining Association Sergei Bezdelov said that Russian industrial miners can provide pure cryptocurrency liquidity for foreign trade settlements in an amount equivalent to 240 billion rubles. But this is only possible if “weighted regulation” of the cryptocurrency mining sector is introduced in the country.
If the state wants, within the framework of the EPR, to see how settlements are proceeding using cryptocurrency, participants in foreign economic activity should conduct such settlements independently and, at most, report on such operations through the same personal account of the Bank of Russia, Kirillov believes. In his opinion, the updated bill lacks key aspects for participants in payments in cryptocurrency — full recognition of cryptocurrency as property and resolving taxation issues for such transactions. If cryptocurrency is allowed to be used as a means of payment, transactions with it should be explicitly exempt from VAT, the lawyer clarifies.