Russian banks will be able to block accounts for cryptocurrency transactions

Russia’s regulator has added digital currency transactions to the list of suspicious transactions for financial institutions.

The Bank of Russia has clarified the grounds for blocking bank accounts. According to the amendments to Regulation 375-P, financial institutions have the right to freeze or even block a bank account if there are indications of digital currency turnover.

Cryptocurrency transactions, as well as „transactions involving the circulation of digital rights, which are characterized by unidirectional, regularity, in large amounts“ are now included in the list Bitcoin Rush of suspicious transactions for money laundering or terrorist financing.

The approved amendments will come into force as early as October 2021.

It only gets better from here
The tightening of the cryptocurrency trade comes against the backdrop of the Digital Financial Assets Act coming into force. From 1 January 2021, the use of cryptocurrencies as a means of payment is prohibited. The regulation of mining, the organisation of issuance, as well as the circulation of digital currency in Russia has not yet been approved at the legislative level.

Back in early January, Anatoly Aksakov, Chairman of the State Duma Committee on Financial Market, said that in 2021, control over cryptocurrency asset owners will only become stricter, as the relevant issue has already been raised in the government. Aksakov did not clarify how exactly the control over the crypto market will be strengthened.

That said, the digital ruble being studied by the Bank of Russia is unlikely to have the same advantages as bitcoin. At least, that is the opinion of Vasily Solodkov, director of the Banking Institute of the Higher School of Economics (HSE). Bitcoin has the ability to „circumvent various restrictions,“ he said. The digital ruble, however, is unlikely to offer the same level of freedom, according to Solodkov.