Crypto payments are now illegal in Russia after President Vladimir Putin signed a law prohibiting their use in exchange for goods and services. This is a huge blow for digital currency because its value depends on acceptability.
However, it appears that cryptocurrency exchanges are still functioning in the region. The ban extensively covers all cryptos as well as NFTs. Additionally, crypto exchanges in the country are directed to reject transactions that may be interpreted as a form of payment.
According to Protocol, the law will be effective from July 26, 2022. In part, it states:
“It is prohibited to transfer or accept digital financial assets as a consideration for transferred goods, performed works, rendered services, as well as in any other way that allows one to assume payment for goods (works, services) by a digital financial asset, except as otherwise provided by federal laws.”
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Russia has always been opposed to cryptocurrency. Its Central Bank had called for an outright ban of its use in the past, but the country’s minister of finance opposed the ban, believing that it is important to let the tech thrive as it is doing in other countries.
The new law could be an offshoot of the increasing tech sanctions against Russia by mostly US crypto companies. Likely, the reasoning behind the law is that it would reduce the dependency on digital assets and make it less economically strenuous when further sanctions are applied.
For now, it is not illegal to mine crypto in the country, which is another critical aspect of the industry. Also, Russians can still invest in cryptos.
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