Russia Proposes Legislation To Criminalize Unlicensed Crypto Operations

In a recent development, the Russian government has introduced a bill before its lower legislative house to criminalize the operation of unregistered crypto services in the country.

The draft law’s explanatory note read:

According to this proposed bill, individuals could incur as high as $4,000 in fines and get a prison sentence of up to four years (or more severe penalties if part of an organized group) for running an unlicensed digital asset operation. “The same act committed by an organized group, or involving the infliction of damage or the extraction of income on a particularly large scale, would be punishable by compulsory labor for up to five years or imprisonment for up to seven years,” the draft proposal said.

If signed into law, the ensuing criminal cases will be investigated by investigators from the Investigative Committee and the Federal Security Service (FSB). It is worth noting that the Supreme Court (SC) did not accept the bill in its current form, stating the lack of a “reasoned justification” in the explanatory note for criminal penalties for illegal crypto circulation.

While these new Russian laws (passed and proposed) seems to put the matter of regulatory clarity to bed, their seemingly stringent approach has been called into question in the crypto crowd over the past few months.