Russia may create its own cryptocurrency exchanges to circumvent sanctions

Since invading Ukraine, Russia has been subject to a series of global sanctions. Now, to try to circumvent these restrictions, the country can launch national cryptocurrency exchanges.

This is what Alexander Yakubovsky, deputy of the State Duma (Russian parliament) and member of the working group on cryptocurrency regulation, said.

“We have all the resources, including creating our own exchanges, using other payment schemes, and using other platforms. Cryptocurrencies are an area where it is difficult to talk about really operational restrictions in our country,” Yakubovsky said according to local portal Parliamentskaya Gazeta.

BTC Could Minimize Sanctions Damage

The deputy further noted that cryptocurrency exchange Binance – which recently stopped supporting transactions with Visa and Mastercard cards issued in Russia – continues to advise Russian lawmakers on the development of regulation in the sector.

In this sense, Yakubovsky believes that effectively prescribed regulation can open up Russia’s access to the financial market. At the same time, for him, the use of crypto-assets, such as BTC, can minimize the damages of sanctions.

As far as cryptocurrency mining is concerned, Yakubovsky said that Russian miners will not leave the market. It further stated that the activity should be defined as a separate type of economic activity:

“We need to make the registration process as simple as possible, submitting reporting documentation, setting a minimum tax rate, and simplifying the payment of tax fees.”

Also according to Yakubovsky, Russia has a surplus of energy capacity in several regions for the activity:

“It would be wrong not to use this potential for the development of the economy and the country. Today we understand that blockchain technology and startups in this area are the future. The bans are not going to solve anything here,” he said.

Cryptocurrency regulation in Russia

It is worth noting that, even before the start of the war, the Russian Ministry of Finance presented to the government a bill with guidelines for the digital currency sector.

At the time, the ministry said that the proposal allows Russians to invest in cryptocurrencies. However, citizens could not use digital assets for purchases such as currency.

“The use of digital currencies as a means of payment on the territory of the Russian Federation will continue to be prohibited. Under the proposed regulation, digital currencies are considered only as an investment vehicle.

As for cryptocurrency mining, the proposal defines the activity as “focused on obtaining cryptocurrencies”. The text did not, however, provide additional details on the matter.