In a significant legislative move, Russia passed two crypto bills on Tuesday. After their attack on Ukraine, Russia has been cut off from the global payments network. This is affecting their economy. Keeping a full crypto ban domestically, they wish to use crypto payments internationally. Let’s explore how these two bills can help Russia to save their economy.

Crypto for International Trades

In the first three readings, the Russian parliament has passed two crypto bills. The first one will allow Russia to utilize crypto as payment method for international trades. This law would enable the Central bank of Russia to build a pilot project that will explore ways to use cryptocurrency in cross-border transactions. 

The Western sanctions have hampered Russian international transactions. They are experiencing business interruptions in global trading with their key partners like China, UAE and India. Russia faces significant delays in payments coming from international markets. Even though Russia has tried to trade with currencies of its partners, they conduct most payments in either Dollar or Euro to go through the international SWIFT system. This risks secondary sanctions from western regulators on banks in partner countries.

According to the Central bank of Russia, the delay in payments is causing great damage to the economy as this has already caused an 8% decline in Russian import. Russia hopes use of cryptos would help them easily buy the banned goods as cryptocurrency is hard to track. And the use of cryptos for cross border trades will allow certain industries to bypass the regulations. Russia is not the first country to take such steps. Afraid of western regulators, Venezuela has already adopted this path.

Crypto Mining Regulations

The second bill that passed in the lower house of the Russian government will legalize cryptocurrency mining in the country. This bill will mandate the Bank of Russia and the government to mandate regulations for crypto mining. This will be monitored and administered by a federal entity. The aim behind all this is to make crypto mining legal in the country and facilitate tax payments as this will ensure declaration of income.

Looking Ahead

The lower house of the Russian parliament has already passed these bills and will soon send them to the upper house for voting. Once the upper house passes them, they will send them to the President for final approval. This bill also aims to reduce legal risks. They will sell the mined crypto without using Russian information infrastructure. This will exempt these transactions from currency regulations. The bills once approved will take effect from 1st of September, 2024. Western regulators have already imposed sanctions on Russia and these bills will definitely add more bitterness to the whole scenario. One must not forget that even though Russia is working to implement these two crypto bills, they still completely ban the use of cryptocurrency for domestic trades.

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

©2024 CoinDesk

English

Hey there! My name is Logical Thesis and I’m a writer for WOLF Financial. If you are looking for more investing related content, I guarantee you’ll enjoy my content on 𝕏, @LogicalThesis. Thanks for reading!

In a notable shift from his previous criticism, former President Donald Trump has recently adopted a more favorable view of cryptocurrencies. This change could significantly impact the cryptocurrency industry if he were to return to office. Previously labeling digital currencies as a threat to the U.S. dollar and denouncing their volatility, Trump has now recognized their potential benefits. His new stance was highlighted in recent public speeches, where he discussed the innovation and opportunities digital currencies could bring to the financial system. This change of heart is significant as Trump spoke at the Bitcoin Conference last week in Nashville, TN.

Should Trump re-enter the White House, the cryptocurrency industry might enjoy a more supportive regulatory environment. This could include policies aimed at fostering innovation while implementing safeguards against fraud and misuse. Such a shift would likely encourage greater investment in blockchain technology and digital assets, potentially strengthening the United States’ position in the global cryptocurrency market. Many billionaires are donating to Trump’s campaign, to which Mark Cuban refers to as ‘the Bitcoin play.’

Trump’s embrace of cryptocurrency might also lead to the development of clearer regulatory frameworks that provide stability and predictability for businesses and investors. This could help legitimize cryptocurrencies further, integrating them more deeply into the mainstream financial system.

Additionally, Trump has acknowledged the sector’s potential for job creation and economic growth. His administration might pursue policies that promote the expansion of the crypto industry, including initiatives to attract crypto-related businesses and talent to the United States, thus enhancing the nation’s competitive edge in this rapidly evolving field.

Further bolstering this positive outlook is Trump’s newly selected vice president, JD Vance, who is known for his pro-Bitcoin and pro-cryptocurrency stance. Vance, a vocal proponent of Bitcoin and blockchain technology, has highlighted their potential to democratize finance and challenge traditional banking systems. His views align with the growing belief that cryptocurrencies can enhance financial inclusion and spur innovation. With Vance’s support, a Trump administration could deepen its commitment to creating a favorable environment for the growth and development of the cryptocurrency industry.

Story continues

In summary, a Trump presidency with a more positive stance on cryptocurrencies, bolstered by JD Vance’s pro-crypto views, could herald a new era of growth and innovation for the industry. By fostering a balanced regulatory environment and supporting the integration of digital assets into the financial system, their administration could help solidify the United States as a global leader in the cryptocurrency space.

Disclaimer: This service is for general informational and educational purposes only and is not intended to constitute legal, tax, accounting or investment advice. These are my opinions and observations only. I am not a financial advisor.