Russian lawmakers weighing partial reversal of digital currency payments ban

Digital currency payments in Russia are illegal, but according to local reports, this might soon change. The reports note that some lawmakers in the country are considering revising some aspects of the payments ban including allowing digital currencies to be used as payment in domestic contracts.

Russia has made it clear in the past that only the ruble is an accepted payment medium in the country. It has ruled out the use of Bitcoin and other digital currencies for payments. Russia’s central bank has also been researching and developing a digital ruble, which according to one of the top lawmakers is the highest form of money.

According to a report by Moscow-based news agency Interfax, lawmakers in the State Duma are weighing some revisions. Pavel Krasheninnikov, the chair of the State Duma’s Committee on State Building and Legislation, revealed that there are proposals to amend the law to allow digital currencies as a payment medium in domestic contracts.

Speaking at the St. Petersburg Legal Forum, the lawmaker noted that the current law restricts merchants from accepting digital currency payments. However, in instances when the two parties conducting the payment consent to digital currency payments, then they should be allowed to transact, he claimed.

He remarked, “Currently there is an understanding that digital currency is not legal as payment but this payment method, quite possibly, can be contractual.”

Such an amendment would open a big market for digital currency adoption in the country. Russia is currently the 11th largest economy globally. While it is behind its peers such as South Korea and Canada in digital currency adoption, it’s home to a large contingent of block reward miners. Regions such as Siberia, which have low power costs and a cold climate, have the ideal conditions for the miners, and in the recent past have seen an uptick in mining activities.

As Russia contemplates amending its laws, the U.S. recently showed a desire to further regulate the industry, proposing that all digital currency payments above $10,000 must be reported.

The Treasury Department recently issued a statement stating, “Further, as with cash transactions, businesses that receive cryptoassets with a fair market value of more than $10,000 would also be reported on. Although cryptocurrency is a small share of current business transactions, such comprehensive reporting is necessary to minimize the incentives and opportunity to shift income out of the new information reporting regime.”

See also: CoinGeek Live panel, Better Payments: Improving the Consumer Experience with Bitcoin