Russian authorities are not going to allow cryptocurrency lending, the finance ministry has announced, clarifying its proposals for crypto market regulation. The treasury department also revealed that not all cryptocurrencies will be available to Russian investors under the new rules.
Russian Government to Restrict Investor Access to Crypto Assets
Authorities in Moscow are not planning to permit loans in cryptocurrency or its use as collateral, the Ministry of Finance has emphasized in an explanatory note to its regulatory proposal. The department’s concept was recently approved by the federal government to form the basis of Russia’s legal framework for the crypto sector.
The treasury adds that market participants will be obliged to duly inform citizens about the heightened risks associated with digital currencies. Russian regulators also intend to impose restrictions and introduce strict control over advertising of crypto-related products and services, Tass news agency reported, quoting the document.
The department suggests that officials consider limiting the number of cryptocurrencies available for trading in Russia for the sake of protecting investors. Foreign crypto exchanges rarely verify crypto projects thus allowing the coins of fraudulent schemes and financial pyramids to be listed, the ministry explains and states:
Furthermore, the finance ministry wants to allow non-residents to purchase cryptocurrency on both domestic and foreign-registered digital asset exchanges that have an office in the Russian Federation. However, these investors will be required to withdraw any funds from these platforms through authorized local banks.
Russian authorities are now working to adopt comprehensive regulations for the country’s crypto space. A proposal by Bank of Russia to adopt a blanket ban on crypto operations was rejected by other government institutions, most of which have sided with the finance ministry, favoring strict regulation over prohibition.
The treasury department and the central bank have been tasked to prepare a draft law implementing the government-approved regulatory plan by Feb. 18. Lawmakers at the State Duma are expected to adopt the new legislation during the spring session of the lower house of parliament.