Russian President Vladimir Putin has signed into law a bill regulating cryptocurrency and digital financial asset transactions. According to Russian media reports, the legislation was approved by the State Duma on July 22 and by the Federation Council on July 24. The law is set to take effect on Jan. 1, 2021. Its main significance is that Russia now gives cryptocurrency formal legal recognition, while drawing a firm line against its use in payments.
Cryptocurrency Gains Legal Definition
The new law introduces an official definition of digital currency. As described in reports, digital currency is recognized as a set of electronic data that may be accepted as a means of payment and also as an investment, but it is not the monetary unit of the Russian Federation or any foreign state. Even with this legal recognition, the law clearly states that digital currency cannot be used to pay for goods or services. In practice, this gives crypto a legal footing as an asset, but not as a circulating payment instrument.
Digital Financial Assets Allowed for Trading
The legislation also defines digital financial assets, or DFAs. These include digital rights involving monetary claims, the ability to exercise rights under negotiable securities, rights to participate in the equity of a non-public joint-stock company, and rights to demand the transfer of negotiable securities under a DFA issuance decision. Under the law, such assets may be sold, purchased, exchanged, and pledged, but they also cannot serve as a means of payment.
On the regulatory side, Russian banks and exchanges may become operators for DFA exchanges if they register with the Bank of Russia. The central bank will maintain the registers of information systems and DFA exchange operators, and it will oversee the activities of information system operators.
Court Protection Tied to Disclosure
The law further states that individuals and legal entities in Russia will only be able to challenge cryptocurrency transactions in court if they have declared both their transactions and their crypto holdings. This links legal protection directly to disclosure obligations.
Notably, several industry terms such as “token” and “mining” were removed from the final version of the bill after the second reading. Anatoly Aksakov, head of the State Duma Committee on the Financial Market, said more detailed cryptocurrency regulation could appear in another bill, possibly during the autumn session. Overall, the legislation establishes Russia’s baseline policy toward crypto: legal recognition as an asset class, but no approval as a payment method.