22. September 2023

Russia to Legalize Cryptocurrency for Foreign Trade in May

• Russia’s Congressional finance committee chairman, Anatoly Aksakov, announced that the country is planning to legalize cryptocurrency to be used in foreign trade activities in the next month.
• The circulation of cryptocurrencies as a means of payment on the territory of Russia will be prohibited and liability will be prescribed in this regard.
• This possibility has been teased by Russian officials for almost a year, following a package of Western sanctions deployed in the wake of the nation’s invasion of Ukraine.

In what could be a major development for the cryptocurrency industry, Russia’s Congressional finance committee chairman, Anatoly Aksakov, has announced that the country is planning to legalize cryptocurrency to be used in foreign trade activities in the next month. This news comes after a package of Western sanctions were deployed in the wake of the nation’s invasion of Ukraine and has been teased by Russian officials for almost a year.

According to a report by the national news agency, TASS, Aksakov said in January, “We want to legalize cryptocurrencies to ensure foreign trade activities.” He further highlighted that although Russia is taking steps to allow bitcoin and cryptocurrency payments for imports, there are no plans to encourage similar usage of the burgeoning assets within the boundaries of the nation’s territory. “The circulation of cryptocurrencies as a means of payment on the territory of Russia will be prohibited, and liability will be prescribed in this regard,” he said. “But to pay for foreign trade transactions, we still assume the possibility of using cryptocurrencies, for example, for parallel imports.”

Russia laid out a roadmap for bitcoin regulation in January 2022 and the Ministry of Finance submitted a proposal in the following month. Around the same time, U.S. President Biden announced the first tranche of Russian sanctions, blocking five of the biggest Russian banks and freezing all the assets they held in America. One month later, Russia said it was open to selling natural gas for bitcoin. The chairman of the country’s Congressional energy committee, Pavel Zavalny, said in a press conference at the time, “There can be a variety of currencies, and that’s a standard practice. If they want bitcoin, we will trade in bitcoin.”

Since then, the idea has gained steam and different areas of Russia’s government has been actively involved in making cryptocurrency payments for imports possible. However, it remains to be seen if the government will take any further steps to make cryptocurrency more accessible to citizens in the country. If the government greenlights the use of cryptocurrency for foreign trade next month, it may open the door for other countries to follow the same path.