RACIB argues that Russia’s current regulatory stance on the cryptocurrency industry will lead to “direct financial losses” for the country.
As Russia continues to delay adopting cryptocurrency regulations, local lawyers have appealed to Russian President Vladimir Putin to change the government’s approach to regulating the market.
The Russian Crypto and Blockchain Industry Association (RACIB), the main group of crypto and blockchain enthusiasts in Russia, sent an open letter to Putin on March 6, calling on the president to address the dangers of neglecting the crypto company’s global development.
In the letter, RACIB argued that Russia is too slow to implement experimental legal regulation aimed at crypto adoption, despite implementing its first crypto law, “On Digital Assets”, in 2021.
In November 2022, Russian lawmakers introduced a series of legal amendments to the crypto law, proposing the launch of a “national cryptocurrency exchange”. According to RACIB, some of the reforms will hinder the adoption of digital financial technologies in Russia by introducing criminal sanctions against local blockchain developments.
The proposed reforms will give Russian authorities a “strong will” to enter the crypto community, RACIB Executive Director Alexander Brazhnikov told Cointelegraph.
“It will not be easy for companies working in the digital device industry to prove that they are doing everything within the framework of Russian laws,” Brazhnikov said.
RACIB finally called on Putin to end Russia’s hostile legal stance on crypto, as it prevents local businesses from fully exploiting crypto’s potential and leads to “direct financial losses” for the country. RACIB says:
“The state policy related to the regulation of digital financial instruments poses a serious risk for the Russian economy to fall behind not only unprofitable countries, but also behind friendly countries due to the delay in the introduction of technologies – a new money machine.”
According to RACIB, one of the biggest risks behind ignoring the benefits of the crypto industry is the movement of local talent to developed jurisdictions, including Eurasian Economic Union (EAEU) countries such as Kazakhstan and Armenia.
To help Russia change its strict crypto policy, RACIB asked Putin to create a working group with representatives of the digital asset community to work with the government to develop the state’s crypto policy. The group has shown particular interest in the development and use of cross-border payment systems in Russia, EAEU jurisdictions and other countries such as Brazil, India, China and South Africa.
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In 2021, RACIB’s Yuri Pripachkin argued that Russia had “done nothing” to regulate the local cryptocurrency market.
The news comes shortly after Russia’s central bank reiterated its uncertain stance on crypto, with Elizaveta Danilova, head of the Bank of Russia’s security sector, arguing that legalizing crypto investments threatens the well-being of Russian cities. At the same time, the Bank of Russia sees no legal problem in allowing cryptomining and the use of cryptography in cross-border transactions.
