Digital asset exchanges must be obliged to provide user information to Russia’s law enforcement agencies, the country’s Prosecutor General has insisted. The circulation of cryptocurrencies in the Russian Federation needs to be regulated to counter money laundering, the official added.
Cryptocurrency Exchanges Have to Report to Russian Authorities, Chief Prosecutor Says
Crypto service providers should be required to register in Russia and exchanges obliged to share information about their users with Russian security services, according to the head of the nation’s Prosecutor General’s Office, Igor Krasnov.
He also believes that merely granting cryptocurrencies property status under Russian law is not sufficient to fight the legalization of criminal proceeds. Krasnov urged for their regulation in order to address the challenges posed by their use for illicit purposes.
Quoted by the “Financial Security” magazine published by Russia’s financial watchdog, Rosfinmonitoring, the top prosecutor further explained that the difficult geopolitical situation increases the risks of exploiting vulnerabilities associated with digital assets.
Igor Krasnov also called for adding cryptocurrencies to the Russian criminal law, including recognizing that they can be the subject of crime and encroachment as well as establishing procedures for their seizure, storage, and confiscation by the state.
Crypto assets and related transactions are yet to be comprehensively regulated in Russia where lawmakers and other officials are still considering their approach. Most government institutions favor a restrictive regime preventing their free circulation while legalizing some activities such as mining as well as payments in cross-border settlements and trading under special legal regimes.
A bill on crypto mining is still under review in the State Duma, the lower house of Russian parliament. Reports revealed last month that lawmakers are considering introducing criminal liability for miners evading taxation and failing to report their digital asset holdings to the government.
The proposal, originating from the finance ministry, provoked a reaction from the Russian crypto industry association which asked for clarification and warned that Russia may lag behind other countries if Moscow maintains its tough stance on crypto regulations.