Illegal Use of Cryptocurrency Largely a Myth, Russian Lawmaker Says – Regulation Bitcoin News

According to the latest statements of a Russian lawmaker, only a tiny percentage of cryptocurrency transactions are used for illegal purposes. Andrey Lugovoy is one of the deputy members working on crypto regulations. He also stated that Russia could become a leader in crypto mining.

Russian Developers Working on Software Detecting ‘Dirty’ Cryptocurrency

According to Andrey Lugovoy (a member of the State Duma’s working group on cryptocurrency regulation), the illegal use of crypto currencies is mostly a myth. “According to the largest crypto exchanges, no more than 4 to 6% of the cryptocurrency turnover is involved in illegal activities,” the lawmaker told Parlamentskaya Gazeta.

Lugovoy is the deputy chairman of security and anti-corruption. He pointed out that it was possible to detect wallets being used for illegal purposes using effective tools such as Crystal and Chainalysis, which are offered by Blockchain analytics companies Crystal and Chainalysis. He added that Russian IT developers are also working on domestic software capable of detecting “dirty” cryptocurrency.

“According to experts, cash is used in illegal activities in the amount of 11 to 13 % of the turnover,” the deputy noted. The deputy believes that transparent cryptocurrency regulations and the identification of users of digital currencies in Russia will allow the government to fight income concealment.

This week, the parliamentary Financial Market Committee approved amendments that will allow the taxation of operations with cryptocurrencies while the Ministry of Finance backed proposals from Russian law enforcement agencies for the new law “On Digital Currency”. Both pieces of legislation should be adopted during the Duma’s spring session to comprehensively regulate the Russian crypto space, along with the law “On Digital Financial Assets,” which went into force in early 2021.

Andrey Lugovoy previously rejected requests to ban all cryptocurrency-related activities within the Russian Federation. He has now admitted that there’s a consensus in Moscow among the government institutions regarding whether cryptocurrencies can be used as payments. In his interview, he said Bitcoin and other cryptocurrencies should be treated as property.

However, Russian authorities have no plans to restrict the ownership of cryptocurrency assets. This was stressed by the Duma member. Cryptocurrency owners may be required to disclose their digital assets to the government.

The legislative changes also aim to bring millions of “grey” crypto miners out of the shadows, Lugovoy said. He highlighted Russia’s contribution to this market, with close to 12% of the global bitcoin hashrate, and ranking third among mining destinations. Given the country’s cold climate and surplus of low-cost electricity, Russia can become the world’s mining leader, the lawmaker elaborated.

Are you expecting Russia to create a crypto-friendly regulatory structure and rethink its position regarding cryptocurrency payments? Leave your comments below.

Lubomir Tassav

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.