Crypto in the house

The government presented a draft criminal liability for illegal trafficking in cryptocurrencies

The government has approved amendments to the Criminal Code to punish illegal trafficking in cryptocurrencies. Those caught engaging in this activity without a Central Bank license face not only fines, but also possible imprisonment for up to seven years. This means that almost any crypto business where there is input and output of fiat funds becomes illegal.

You can talk about the causes and consequences for a long time, but if you suddenly need a short and succinct comment, then all this, oddly enough, is not so important. Of course, we can say that we will monitor law enforcement, but life is such that a special reason is not needed to initiate a case. If only there was a person, there would be crypto.

Yes, in the current realities, cryptocurrencies have become a convenient way to move capital. Given the abundance of services with mandatory KYC/AML procedures, no one has canceled alternative platforms. It's like good old cache. Digital only.

From an economic point of view, everything is also obvious: the growing tax burden and problems with cross-border transfer of funds. In these situations, crypt comes to the rescue and no longer requires any special knowledge. I started a wallet, received a coin, issued a Visa card somewhere linked to my account, and spend it on my health. In a rare country there are difficulties with cashing out “digital gold” in both legal and not so legal ways.

From this point of view, the government initiative, which has every chance of coming true, is an attempt to intimidate, nothing more.

Strict criminalization of activities, even in the presence of high-profile criminal cases, will not produce significant results. You have to live somehow. An example of a phenomenon called “fartsa” (illegal circulation of currency and scarce goods in the late USSR) only confirms the thesis. The threat of punishment does not in itself prevent crime.

If there is damage, it will be on a symbolic plane. Indeed, in its rhetoric, our state still fiercely demonstrates its status as a progressive power, the birthplace of innovation. But endless regulations and threats of persecution are not the best way to develop new technologies, especially when there are already many examples even among close neighbors.

Before all the events, even the Belarusian High Technology Park showed interesting results - crypto projects registered in the special economic zone looked both attractive and competitive. In Armenia there are quite clear rules for the circulation of virtual funds, and there are no problems with the purchase, sale and storage.

One gets the impression that the entire state machine has entered an ideological dead end. On the one hand, there are paper declarations of endless successes and achievements, on the other, repression, and all this against the backdrop of deteriorating economic, political and generally all situations. No matter how many laws are passed, there is no real result in practice.

To dilute the deservedly pessimistic philippic, you can dream about how it could be. The most radical example is the complete deregulation and decriminalization of the market. It’s scary to imagine what kind of howl would arise “in the swamps” of traditional financial institutions, both local and foreign. But sovereignty can be used in different ways: to do better than others, for example.

How fantastic, but still the result is economic growth. The emergence of alternative, fashionable and independent means of payment could boost the ailing economy. And moreover, ultimately increase the taxable ruble base: even with total legalization and integration of crypto, there will be a million points where conversion into fiat money is necessary. However, not the most far-sighted officials and the ever-frightened intelligence services rule out such a scenario.

In reality, you can prepare for the next layer of criminal cases against those who are caught in the act of organizing a crypto exchange. Technically, today it looks like a lot of bank accounts, most often opened with third parties and perhaps unsuspecting individuals, and a corresponding amount of crypto. Next is the work of a typical exchanger with profit in the form of commission from completed transactions. The scale depends on arrogance, courage, capabilities and, in some cases, “roof” - many government officials have their own interests in specialized structures, the legality of which is, to put it mildly, questionable.

If you look at the letter of the law, then everything does not seem so dramatic. For violations on a large scale (from 3.5 million rubles), only a modest fine or forced labor is expected.

The actual prison term is from 13.5 million rubles. For many, these figures seem fantastic, especially when compared with pensions. But in real life, this is a day of work for not the luckiest crypto businessman. The “real boys” have tens of times more.

The legends about bags of cash have not gone away. In place of closed projects, others grew up. And all this today - from Moscow to Vladivostok.

The bottom line is, instead of any real changes, we have a total degradation of the legislative framework: the volume of articles and laws, most often meaningless and duplicating each other, is only growing, as is the number of cases of criminal prosecution, within which most often it is not a violation of certain norms, but money and politics.

And yet there was happiness: cheap electricity (the mining market could become a new Klondike), and brains, which until recently were in abundance, and endless innovations - from Skolkovo to special economic zones.

In a parallel universe, Russia had every chance of becoming a crypto paradise. But, alas, in the coming years it is destined to be a crypto-colony. In any case, for those involved in the circulation of digital assets. In a particularly large size.