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Posted   |     |   thehodllife

Russia’s ‘Digital Law’ Bill Won’t Legalize Cryptocurrency


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Russia’s State Duma Committee on State Construction was scheduled to hold the first reading of amendments to the country’s civil code pertaining to digital currency today, but is not expected to make digital currency a legitimate method of payment, according to Izvestia, the news portal of the Ministry of Information Technologies.

The bill, which the State Duma Committee on State Construction plans to support, will establish a legal basis for digital rights and digital transactions, Head of the State Construction Committee Pavel Krasheninnikov told Izvestia.

Experts, meanwhile, consider cryptocurrency a “promising” entity, making it worth including in the country’s legal arena.

Amendments were sent in March to Krasheninnikov and Vyacheslav Volodin, the State Duma Speaker.

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President Vladimir Putin previously told the central bank and the government to provide an assessment of cryptocurrency, including all the risks it involves and whether it is necessary to utilize new technological solutions in banking.

Officials believe the law will eliminate risks of digital objects being used to place assets in an uncontrolled environment, by which proceeds of crime can become legalized.

Users of cryptocurrencies can be unprotected on account of insufficient regulation, according to the draft.

While digital currency does not become a legal method of payment, it follows from the bill that in the future, such currencies will be used as payment “in controlled quantities.” By that time, a separate law by the Ministry of Finance, the Ministry of Economic Development and the Central Bank will establish the conditions by which such payment can occur.

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The bill considers digital confirmation of an identified user as his written consent, serving as a means of signing a “smart contract.” A transaction is considered complete after signing and can only be disputed if there is third party interference in the computer program’s operation.

The bill also legalizes processing and collecting large amounts of information.

Russia Blocks Several Bitcoin Websites
Russia’s “Digital Law” bill does not legalize cryptocurrencies, though futures legislation might.

The State Duma’s legal department has been advised to use the concepts “cryptocurrency” and “token” rather than “digital money” and “digital law,” based on terms that are used in practice.

The bill does not address all of the president’s directives,…

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