Thursday, November 26, 2020
Home News BTC Bitcoin Community Reacts to Russia’s Criminalization of Undeclared Crypto Activity

Bitcoin Community Reacts to Russia’s Criminalization of Undeclared Crypto Activity

Bitcoin is not welcome in Russia. The Central Bank of Russia, this year, put in place legislation that bans the issuance and circulation of cryptocurrencies.

But officials in the country accept that an outright ban is unenforceable. Speaking on the country’s Digital Assets Bill, Alexey Guznov, the Director of the Bank of Russia’s Legal Department said:

“Nobody is going to ban owning cryptocurrencies… [people will not be punished for owning crypto] if they made their deal in a jurisdiction that does not prohibit that.”

Russian lawmakers hold firm that the rouble should be the only legal means to transact in the country.

Russia Revises Legislation to Criminalize Non-Disclosure of Bitcoin Activity

Things took a turn for the worse yesterday as Russian newspaper Kommersant reported that authorities are looking to ramp up restrictions on Bitcoin and other cryptocurrencies.

Russia’s Ministry of Finance has issued proposals to revise legislation regarding the circulation of cryptocurrency. This relates primarily to the duty of users to declare their cryptocurrency activity, including details on all wallets held.

Ministers are meeting this week to discuss the proposals. If ratified, changes to the Criminal Code, Criminal Procedure Code, Administrative Code, Tax Code, and money laundering legislation will be put in place.

More specifically, lawmakers want to know if citizens have received more than 100,000 roubles ($1.3k) of cryptocurrency in a calendar year. If so, relevant persons must inform the tax office by declaring it on their tax return.

If the legislative amendments go through, the inclusion period will be for 2020 going forward. Therefore, individuals should declare their crypto activity by the end of the Russian tax year on April 30, 2021.

For failure to report to the tax authority, you can receive a fine of 30% of crypto assets, but not less than 50 thousand rubles.

But non-declaration of a crypto wallet, which has turned over more than 1 million roubles ($13k) in a year, will be classed as a criminal offense punishable by up to three years in prison.

Anatoly Knyazev, the Co-founder of investment firm Exante, opposes the penalities. He believes they are wholly disproportionate to the offense.

The proposals also seek to govern crypto companies, such as exchanges. The Kommersant reports that they must submit quarterly reports to the tax authorities.

The Community Reacts

The Bitcoin community has reacted defiantly to the reports.

While many take the view that these are the actions of a legacy system on its last legs, the overall concern centers around tougher tax legislation coming to their respective country.

However, one Twitter user sympathized by implying we all have a duty to pay our taxes. What’s more, if US authorities implement similar legislation, it’s likely to be enforced only with fines, rather than imprisonment for the most serious cases.

Others point out that privacy coins have never been as important to personal liberty as they are right now.

With that, Bitcoin remained unphased by the announcement, even seeing a move back above $10.5k.

Bitcoin daily YTD chart

Bitcoin YTD daily chart with volume. (Source:

Popular Articles

Bitcoin Liquidation Data Suggest Recent Crypto Rally Wasn’t Driven by Retail Buyers

It has been a rough past few days for Bitcoin and the entire crypto market. Following BTC’s tests of its all-time highs in the...

Wanna win a Bitcoin? Challenger bank Revolut is making that possible this Black Friday

It’s the festive season and that time of the year where new deals, business offers, discounts, buy one get two free, and (err..and even...

Is Ripple’s progress forcing SWIFT to rethink its strategy?

Ripple has been the torchbearer of crypto-related payment solutions using the digital asset XRP. With Ripple expanding its reach globally and connecting niche countries,...

New Members Added To Board Of Coinsquare Exchange

Coinsquare stands as a crypto exchange that has seen its fair amount of scrutiny by Canada-based regulators. This comes after allegations were made against...

AWS Backend Glitch Disrupts Bitcoin Trading on Coinbase

Top cryptocurrency exchange Coinbase has confirmed a second service outage in as many days as its technical infrastructure appears to be hobbling. The exchange explained that...

Nigeria Is Emerging as a True Bitcoin Nation

In brief Nigerians are turning to Bitcoin in the face of a struggling economy. Bitcoin is propping up businesses unable to obtain the US dollars needed...