In January, the Central Bank proposed to ban almost all operations with cryptocurrencies in Russia, explaining this by high risks. The Ministry of Finance, in response, stated that instead of a complete ban, it is possible to establish rules for the crypto market. The interviewed experts believe that Russia can take a softer path, and significantly replenish the budget due to the cryptocurrency. The use of cryptocurrencies in Russia was under threat in January after the Central Bank proposed on January 20 to ban almost all transactions with them. The regulator explained this by the fact that digital assets carry serious risks - for example, citizens can lose their savings, and attackers can use them, among other things, to finance terrorism.

However, the Ministry of Finance then did not agree with the tough position of the Central Bank. Instead, the ministry has proposed regulating this market rather than imposing a total ban.

Some other countries are now also trying to regulate the cryptocurrency market. For example, operations with them were banned in China, which led to an outflow of miners. However, there are examples when the authorities made some concessions. For example, in India, tough measures to regulate cryptocurrencies were previously discussed, but recently the local Ministry of Finance decided to impose a tax of 30% on profits from operations with them. Due to this, digital assets will essentially fall into the legal field.

I decided to ask experts what scenario is most likely for Russia: a complete ban on cryptocurrencies or regulation of this market, as well as how much taxes the budget can theoretically receive.

Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news » Back to news »

Ban cryptocurrencies or benefit?

Russia can go the way of regulating the cryptocurrency market, rather than a complete ban, the interviewed experts believe. They noted that digital assets could be beneficial for the Russian budget.

According to BitNalog, a service for legal work with digital currencies, the potential amount of tax revenues in 2021 alone could be up to 200 billion rubles, Olga Goncharova, GR director of Binance in the CIS, said.

“From the point of view of filling the budget, nothing needs to be banned, it needs to be controlled. It is this proposal that comes from the Ministry of Finance, ”said Maxim Pukhov, an analyst at FG Finam.

In addition, from a technical point of view, even if cooperation with foreign regulators is agreed, it is extremely problematic to implement the control process in practice, the expert added.

Russia also does not need a complete ban on cryptocurrencies, as it will lose prospects in the development of blockchain technologies. “And these are the technologies of the future – not only in the financial market, but also in a number of industries and developments (bigdata, activities of various platforms, etc.), — added Svetlana Samoilova, financial expert, co-founder of the Finliberty school of independent financial consultants.

Now all over the world some solutions are being developed to regulate the cryptocurrency market, Olga Goncharova from Binance noted. For example, the international organization FATF (Financial Action Task Force on Money Laundering) issued a guide to the regulation of cryptocurrency organizations, which prescribed measures against money laundering, promoting terrorism, etc.

The expert also recalled the MICA (Markets in crypto assets) legislation, which is in force in Europe. “It is also quite breakthrough and makes Europe a kind of crypto haven, licensing the activities of individual crypto platforms and making their rules of the game more transparent,” explained Olga Goncharova.

How taxes can be collected and what problems may arise

If Russia follows the regulatory scenario, then both operations with cryptocurrencies and mining equipment will probably fall under taxation due to high electricity consumption, said the financial expert Svetlana Samoilova. Companies investing in the cryptocurrency market will have to obtain a license and operate in a legal field, opening up their income and financial flows, she added.

It is difficult to estimate the number of crypto investors in Russia now - this is the problem with the semi-legal status of digital assets, says Chen Limin, CFO and head of trading operations at ICB Fund. At the beginning of 2022, according to official statistics, there were 17 million people on the Russian stock market, and 532 billion rubles were invested in shares. According to some estimates, the number of crypto-investors is approximately the same as the number of players on the classical exchange.

“Now they say that there are 17 million crypto investors in Russia, and 16.5 trillion rubles have been invested in crypto. This looks extremely stretched, since there are obviously fewer participants in the cryptocurrency market, and for the most part they are small investors who operate with rather modest amounts,” Chen Limin added.The income of miners, according to the expert, is somewhat easier to estimate: they earn about $1.5 billion a year only on bitcoin. “So a 20% rate would bring the budget at least $300 million,” Chen Limin said.

In relation to cryptocurrencies, the current rates for transactions with securities could be applied, says Maxim Pukhov from Finam. In his opinion, this is a logical measure, since conscientious investors use cryptocurrency as an alternative to the stock market. But in practice, it can be problematic to implement, the expert says.

“The reason is that the stock market has long been regulated. Each transaction, both exchange and over-the-counter, is under the control of the regulator. Bringing information to the regulator is entrusted to brokerage companies that have the appropriate licenses. Therefore, it is not difficult to control the correctness of paying taxes. In the crypto industry, things are different. Neither exchanges nor participants in the cryptocurrency market have licenses from the regulator and do not report to it,” Pukhov explained.

He added that organizational issues on the regulation of the cryptocurrency market and the licensing of its participants must first be resolved. And only after that proceed to taxation.

bbabo.Net