Russia: Implementation of Federal Law No. 331-FZ regulating digital financial assets

On 24 July 2022, law No.138674-8 “On Amendments to Certain Legislative Acts of the Russian Federation and the Suspension of Certain Provisions of Article 5.1 of the Federal Law on Banks and Banking Activity” is implemented. The law regulates the circulation of digital financial assets (DFA) and utilitarian digital rights (DPR) as a means of payment in Russia. The law prohibits the use of digital financial assets to pay for goods or services and requires exchange administrators to refuse transactions involving the use of cryptocurrency as a monetary substitute. Furthermore, the law also requires financial, investment or information systems that issue digital financial assets through an electronic platform to register with the central bank as participants in the national payments system. Hence, all significant DFA participation, including emission, circulation, exchange, and trade, would require registration.