Following much deliberation in the past year, Moscow has finally and recently taken imperative steps towards governing the cryptocurrency industry and the crypto sphere. This comes as part of the efforts to enable the development of the Russian digital economy. Russia, which is very much dependent on exports flowing from energy and which has been hit recently following western sanctions, is now looking for alternative options and sources of revenue and cannot, as such, afford to turn a blind eye to Bitcoin and cryptocurrencies for too long.
Regulations have been brought onboard, concerning the future of cryptocurrency and the regulation thereof. They are as of current at different phases of adoption in the Russian Federation. October 1 saw the law” on digital rights” being implemented into force. The law established the basic legal definition of rights in the digital realm and determined their status under the country’s civil rights law.
“Digital rights” in this context is an imperatively new legal term; the scope that can be interpreted to include tokens such as those that are employed in the crypto industry. under the norms in the law are regulations for the use of smart contracts, which include conditions of automated execution of certain agreements.
In order to make it legal for this type of arrangements in other related spheres, which include crypto space, the law on digital rights makes a move to amend the Russian Civil code, which stipulates that a transaction may provide for the fulfillment of obligations by its parties under certain circumstances following the employ of information technology. In other words, an information system can execute contracts by itself, according to Russian Media.
Another bill that concerns itself with issues that relate to digital tokens has already been passed through the legal process to become an integral part of Russia’s current legislation. The law “on attracting Investments using investment platforms,” which is as of currently being referred to as the law on crowdfunding, was signed into legality by Russia’s President Vladimir Putin in August 2019. It is set to come into force by January 2020.
Notwithstanding its relatively ample requirements for potential investment platforms, the law also stipulates numerous restrictions. For example, while aiming to protect the ordinary folk from risky investments, the law makes a point of limiting the annual amount that investors who are not qualified can spend on such projects. The cutoff rate is 600000 rubles, which is basically USD 9000.
Furthermore, only entities that are currently registered with the Central Bank of Russia, the CBR, will be allowed to facilitate crowdfunding activities. Enthusiasts have deliberated and insisted that the law is geared towards application for the crypto Industry’s widely employed capital raising method of token sales or initial coin offering (ICO). They do hold the belief that in practice, the utilitarian digital rights that have been introduced in the new Russian laws do correspond to utility tokens that are providing access to a blockchain platform, and the service is it may render to its investors.