19 Sep 2022 16:50

MinFin: law on cryptocurrency should give businesses right to conduct settlements in crypto, details to be determined in practice

MOSCOW. Sept 19 (Interfax) - The draft bill on digital currencies prepared by the Finance Ministry should create a framework for settlements, while the details - including the list of currencies used and the list of counterparty countries - will be determined in practice, head of the Finance Ministry's Financial Policy Department Ivan Chebeskov said while speaking at an ICC Russia round table titled "Cryptocurrencies in foreign economic activity: mining, payments, fiat transfer."

"The Ministry of Finance has developed a bill on digital currencies, it is comprehensive and includes many things. But in terms of payments, we are rather creating a mechanism for business than building this architecture completely, because it is not completely clear how it should be regulated, so we give businesses the opportunity with this bill to pay with cryptocurrency, but in terms of what cryptocurrencies will be used, how to negotiate with counterparties, with which countries it will operate - all this we are leaving to entrepreneurs," Chebeskov said.

Entrepreneurs "will better figure it out and understand what will work and what will not," he said. "When a large number of people deal with this issue, some correct solution is found over time, better than if we [the authorities] proposed some solution that would not work for many. It will be on the side of business to decide on the spectrum of how it should function," Chebeskov said.

"And if this needs to be raised to some intergovernmental level, then of course we will also get involved and promote it somehow as part of international cooperation. But rather, since there are already requests from the business, we expect that this will be work that business has either already done or will do in the future," the official said.

Following a recent strategic session on the development of the financial system chaired by Mikhail Mishustin, the Prime Minister instructed agencies and the Central Bank to "develop a coordinated position on draft federal laws regulating the issue, organization of issue and circulation of digital currency in Russia in terms of regulation of mining and the use of digital currencies in international settlements" by the end of the year.

The Ministry of Finance believes that the potential field of use of cryptocurrencies is not limited to foreign trade transactions.

"The current restrictions are a driver for us to use these technologies, including as a new mechanism for international payments. But in my opinion, this is only a part of all the opportunities that both digital financial assets and digital currencies can provide," Chebeskov said.

The current version of the bill already provides both local infrastructure for trading digital currencies and regulation of mining, he said.

"But mining is also discussed as a kind of separate block of regulation. In terms of the big bill, we had a different vision of the regulation of digital currencies between the Ministry of Finance and the Central Bank, but on mining the vision is more similar, so we have several texts of the bill in parallel, which are now being discussed. I hope that this year we will come to some kind of conclusion regarding regulation. You've probably seen that there is a directive from the prime minister for us to present coordinated proposals on what the regulation should look like by the end of this year. So now we are once again entering the active stage of discussion," Chebeskov said.

The Central Bank and ministries were in active discussions last year, and this received new impetus after harsh sanctions against Russia were imposed in early 2022. The Bank of Russia, which is now testing the digital ruble and plans to develop this platform, has a negative attitude toward private cryptocurrencies. Last week, First Deputy Governor of the Central Bank Vladimir Chistyukhin once again said that the Central Bank is "very skeptical" about the legalization of private digital money because of the high level of risks.