Russia’s State Duma has received a draft bill that would make unlicensed crypto service operations a criminal offense. Under the proposal, individuals running unregistered crypto services could face fines of up to $4,000 and prison terms of up to four years. Penalties rise sharply for organized groups, which could face up to seven years in prison or five years of compulsory labor.
Draft bill targets unapproved digital currency circulation
The proposal focuses on entities involved in digital currency circulation without approval from the Bank of Russia. In addition to prison terms, courts could impose financial penalties of up to 1 million rubles, or about $13,100. The bill also allows fines to be tied to a portion of income earned over five years, widening the pressure on both individuals and businesses facilitating crypto-related activity.
Supreme Court says the timing is premature
Russia’s Supreme Court has pushed back on the bill, arguing that criminal penalties are being introduced too early. The court said the proposal does not yet provide sufficient grounds for criminal liability at this stage. It also warned that enforcing such rules before the Digital Currency law comes into force could create inconsistencies in legal practice and complicate the broader enforcement structure.
According to the report, the underlying legislation is scheduled to take effect in July. That pending timeline is central to the court’s objection. The government has not publicly responded to the criticism so far.
Regulatory reach would expand beyond illegal mining
The bill builds on an earlier legislative package introduced in March that focused on illegal crypto mining, miners, and infrastructure operators. This new step would widen the scope to cover all unlicensed digital asset service providers, not only mining-related activity.
If adopted, the Bank of Russia would receive authority to license and supervise crypto-related operations. Investigations would involve the Investigative Committee and the Federal Security Service. That would extend enforcement beyond a narrow segment of the sector and into a much broader set of digital asset activities.