New Russian Law ‘Could Hit Illegal Crypto Traders with 7-yr Jail Terms’

The State Duma, the Russian parliament, is reportedly set to vote on new legislation that would propose to make illegal crypto trading a criminal offense that would be punishable with jail time.

Per RBC, Telegram users in Russia say that they have seen draft amendments to two Russian laws that pertain to the nation’s criminal code.

The media outlet says that “two sources familiar with the matter” have confirmed the proposals’ authenticity, and the head of the Duma’s financial committee, Anatoly Aksakov, has claimed that the draft amendments are still awaiting consultation.

RBC also quotes Nikita Kulikov, a member of a Duma tech council, as stating that the new rules – if accepted – would only be enforceable if conducted on platforms that are physically based in Russia. This fact, he opined, already rendered the proposed amendments “outdated and inefficient.”

However, the draft amendments do appear to propose some relatively steep measures for crypto trading, mining and exchange-related violations.

They seek to distinguish between cases that involve criminal liability and minor offenses. Under the proposals courts would class the former as being cryptocurrency-related legal violations that “cause major or especially large damage to citizens, organizations or the Russian state.”

Criminal offenses of this sort could be punishable with fines of up to USD 14,000 and up to seven years in prison.

Less severe offenses – such as illegal trading and other crypto-related violations that did not cause “widespread damage” – would incur fines of up to USD 7,000 for ordinary individuals, although public officials could face fines of up to three times that amount.

Companies that break regulations could be forced to close down, and if they are overseas ventures, they might be obliged to leave Russia.

As for miners, the draft legislation states that those making unauthorized use of “equipment located in Russian territory” could face punishment “if this infrastructure is used to transfer digital currency to third parties.”