One month after Russian President Vladimir Putin urged regulators to reach a compromise on regulating cryptocurrency, the Ministry of Finance has submitted a draft law, the government announced in a press release last week.
Under the proposed regulation, digital currencies are only available as an investment vehicle and cannot be used as payment, according to the release. Still, the guidelines are expected to be a step forward for the booming but unregulated industry.
To protect investors, platforms must tell potential customers about the risks associated with digital currencies, the release stated.
Perhaps the biggest surprise in the recommended rules are built-in consumer protections. Before a customer can purchase a digital asset, they are required to take an online test to determine if they are aware of the risk, according to the release.
If a customer passes the quiz, they can invest up to 600,000 rubles (about $7,500) annually in digital currencies, the release stated. If the test is failed, the maximum amount of investment will be limited to 50,000 rubles (about $625).
The proposed measure defines the requirements for exchanges on how digital currencies circulate. To make it happen, a register of operators will be created for corporate governance, reporting requirements, information storage, internal controls and audits, risk management and the amount of funds, according to the release.
Activities of these companies will be licensed and monitored by a government agency to be determined, the release stated.
Any purchase or sale of cryptocurrency will be possible only if the customer can be identified. Cryptocurrency deposits and withdrawals can only be done through financial institutions (FIs) using a bank account, according to the release.
Finance Minister Anton Siluanov told a Russian news service that he hopes the regulations will be passed into law by year’s end.
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