Russia Imposes a Ban on Paying for Things With Crypto or NFTs
Last week, Russian President Vladimir Putin signed into law a ban on all digital payments in the country, a far-reaching move that heralds a shift in how cryptocurrencies and blockchain-based payments are carried out in the country. The move prohibits digital securities and utility tokens serving as a payment method. The bill also bans “the use of digital assets, such as cryptocurrency and NFTs, to pay for goods and services.”
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“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,” the law read.
Although users can still purchase crypto in Russia, the change now means that they cannot use the digital currencies to pay for services or products.
The legal change extends a 2020 digital assets law in Russia that prohibited using cryptocurrencies as a payment method.
In January, Putin boasted about Russia’s “competitive advantages” in the crypto industry, referring to the country’s energy surplus and “well-trained personnel” that carry out Bitcoin mining. A month later, the Ministry of Finance unveiled a parliamentary bill providing a framework for cryptocurrency regulation. Despite the pro-crypto stance of the government, however, the Bank of Russia has maintained a defiantly anti-crypto attitude, clamoring for its outright ban.
Russia’s invasion of Ukraine in February sparked an exodus of crypto companies away from the sanctions-battered federation. Some of the world’s largest crypto exchanges, including Binance and Coinbase, restricted Russian customers from using their services to comply with new American and European rules.
The Ukraine war has also ignited outside concern about how Russia might use crypto as a tool to evade sanctions.
