Casey Wagner

<div id="highlights-block_6259b4e469277" class="highlights">
 <ul>
 <li>The pending legislation, named “On Digital Currency,” was initially introduced to the Russian Parliament in February</li>
 <li>Russia’s central bank called for a ban on crypto mining earlier this year</li>
 </ul>
 
</div>



Russia’s Ministry of Finance has amended its digital currency bill to include cryptocurrency mining provisions, the agency <a href="https://minfin.gov.ru/ru/press-center/?id_4=37855-minfin_rossii_dorabotal_zakonoproekt_o_regulirovanii_tsifrovykh_valyut" target="_blank" rel="noreferrer noopener">announced</a> Friday.



The ministry presented the original draft cryptocurrency law, which focused on digital assets as investment vehicles, to the Russian Parliament in February. The updated version of the bill, the ministry said, details rules around trading and mining cryptocurrencies.



The pending legislation, named “On Digital Currency,” comes as interest in the Russian government’s use of cryptocurrencies continues to increase amid the ongoing war in Ukraine, which started on Feb. 24 when Russia invaded the country.



In January, Russia’s central bank called for a ban of cryptocurrency mining, citing concerns that digital assets could undermine financial stability.



Reports that Russia was considering a state-sponsored digital ruble, its own central bank digital currency, <a href="https://cms.blockworks.co/as-russia-tests-digital-ruble-plans-for-broader-crypto-regulation-are-uncertain/" target="_blank" rel="noreferrer noopener">swirled</a> in early February.



In March, <a href="https://cms.blockworks.co/russias-sberbank-receives-license-to-issue-digital-assets/" target="_blank" rel="noreferrer noopener">Sberbank</a>, Russia’s top lender, was granted a license by the country’s central bank to begin issuing digital assets in response to US economic sanctions. Assets issued on the bank’s digital platform will be recorded and circulated via a distributed ledger technology system, ensuring “data security” and data immutability, Sberbank said.



The license will allow companies in Russia to issue their own digital assets, providing they prove they have the cash requirements, and use digital assets issued through the bank’s information system. The news came as concern over how Russian entities may be using cryptocurrencies to <a href="https://cms.blockworks.co/russian-financiers-could-turn-to-crypto-to-sidestep-us-european-sanctions/" target="_blank" rel="noreferrer noopener">evade sanctions</a> heightened.



The updated version of “On Digital Currency” introduces the concepts of professional and non-professional digital asset purchases, according to a <a href="https://www.kommersant.ru/doc/5306943" target="_blank" rel="noreferrer noopener">report</a> from Russian news outlet Kommersant. It also states the need to assess cryptocurrency products, the rules of trade and mining, the report added.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.

Russian Crypto Bill Amendment Targets Mining, Trading

Sebastian Sinclair

<div id="highlights-block_6233f3e09b85a" class="highlights">
 <ul>
 <li>Russia&#8217;s central bank has granted the country&#8217;s biggest lender a license to begin issuing digital assets</li>
 <li>Sberbank is under duress by US sanctions over the ongoing Ukraine-Russia conflict</li>
 </ul>
 
</div>



Russia&#8217;s top lender has been granted a license by the country&#8217;s central bank to begin issuing digital assets following US economic sanctions that witnessed a seismic drop in the institution&#8217;s value earlier in the month.



Sberbank has been included in the list of information system operators, or approved companies, issuing digital financial assets, the lender said in a <a href="https://www.sberbank.com/news-and-media/press-releases/article?newsID=cd44dd90-1dcf-4bb1-ab20-bc99e52d08a3&amp;blockID=7®ionID=77&amp;lang=en&amp;type=NEWS" target="_blank" rel="noreferrer noopener">statement</a> on Thursday. 



The decree comes amid US sanctions against Russian financial institutions, businesses and individuals over the country&#8217;s invasion of Ukraine, which first commenced Feb. 24. Sberbank, which is state owned, is currently sanctioned by the US and European Union.



Those assets issued on the bank&#8217;s digital platform will be recorded and circulated via a distributed ledger technology system ensuring &#8220;data security&#8221; and data immutability, it said.



Companies will be able to issue their own digital assets, providing they prove they have the cash requirements. Companies will also be allowed to use digital assets issued through the bank&#8217;s information system, which will position them to invest their currently idle funds to generate income, Sberbank said.



&#8220;Companies will be able to make their first transaction on our blockchain platform one month from now,&#8221; Sergey Popov, director of the Transaction Business Division, said in the statement.



<blockquote class="wp-block-quote">&#8220;We are just starting our work with digital assets, realizing that further development requires adaptation of the current regulatory framework. To do that, we are ready to work closely with the regulator and executive bodies.&#8220;</blockquote>



Sberbank lost <a href="https://cms.blockworks.co/us-democrats-ask-treasury-what-effect-cryptoassts-have-on-russian-sanctions/" target="_blank" rel="noreferrer noopener">95% of its value</a> on the London stock exchange at the beginning of the month. Other London-listed stocks, including Lukoil, Novatek and Rosneft, also suffered significant hits due to sanctions.



The lender has the largest market share of savings deposits in Russia and is the country&#8217;s primary creditor issuer. It has operations in several European nations, marking it as the largest bank across the continent&#8217;s eastern borders.



The question whether, or to what extent, Russian government-affiliated entities could use crypto to circumvent Western sanctions is a hot topic in Washington, with the Senate holding <a href="https://cms.blockworks.co/impossible-for-russia-to-evade-sanctions-with-crypto-fincen-rep-says/" target="_blank" rel="noreferrer noopener">a hearing on the matter</a> on Thursday. During that hearing, a bipartisan group of senators <a href="https://cms.blockworks.co/sen-elizabeth-warren-rolls-out-bill-designed-to-close-crypto-loopholes-to-sanctions/" target="_blank" rel="noreferrer noopener">introduced new legislation</a> aimed at ensuring Russia remains largely cut off from global financial infrastructure.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.