The Central Bank of Russia has introduced measures to protect entities working with digital assets from sanctions pressures. These businesses will be exempted from some reporting requirements as part of a regulatory relief intended to minimize the burden on financial organizations.
Russia’s Central Bank Eases Supervision of Digital Asset Platforms Amid Sanctions
The Central Bank of the Russian Federation (CBR) has allowed issuers of digital financial assets (DFAs) not to disclose information sensitive in the light of sanctions risks. The exemption, valid until July 1, 2023, concerns data revealing the beneficial owners of such entities.
According to an announcement quoted by Russian crypto media, the temporary reporting relief is part of a package of measures meant to help persons and organizations operating within the Russian financial market infrastructure.
While Russia is yet to regulate cryptocurrencies like bitcoin, the existing law “On Digital Financial Assets” permits companies to issue coins and tokens in controlled environments. Three “operators of information systems in which DFAs can be issued” have been already licensed by the CBR. These are Russia’s largest bank, Sber, the tokenization service Atomyze, and Lighthouse.
In the press release, the Bank of Russia explained that the regulatory and supervisory relief provided to financial market participants and DFA issuers since earlier this year is intended to minimize the burden on these organizations in the current economic and geopolitical situation.
Russian government and businesses have been the target of expanding Western sanctions imposed over Moscow’s decision to invade neighboring Ukraine in late February. The penalties have severely restricted their access to global finances and markets.
A proposal to legalize the use of cryptocurrencies for international settlements in order to lower the sanctions pressure has been backed by Russian institutions, including the central bank, which has traditionally maintained a hardline stance on crypto regulations.
The CBR insisted that the support offered to financial firms, including DFA issuers and exchange operators, has alleviated the negative effects of the restrictions and allowed them to adapt to the new conditions. The regulator plans additional steps in the same direction such as amendments allowing the recognition of losses due to the sanctions.
Do you think Russian crypto companies will benefit from the measures introduced by the Central Bank of Russia? Tell us in the comments section below.
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Author: Lubomir Tassev