The Russian government has submitted a draft bill to the State Duma, the lower house of parliament, proposing to amend the country's legal code to impose criminal liability on entities offering cryptocurrency services without a license from the Bank of Russia. The legislation targets any organization involved in "activities related to the organization of digital currency circulation" that operates without central bank approval.
Individuals found in violation could face fines of up to $4,000 and prison sentences of up to four years. For offenses committed by an organized group, or those involving damage or income on a "particularly large scale," penalties escalate to compulsory labor for up to five years or imprisonment for up to seven years. The bill also stipulates a fine of up to 1 million rubles (approximately $13,100) or garnishment of the convicted person's salary or other income for a period of up to five years.
This latest draft follows a package of bills proposed in March that included criminal penalties for illegal cryptocurrency miners. The government argues these measures are necessary to combat money laundering and evasion of international sanctions, aiming to centralize exchange operations under state-supervised platforms.
However, the initiative faces significant legal headwinds. Russia's Supreme Court has criticized the bill, stating it lacks "reasoned justification" for criminal penalties and is "premature" until the nation's broader "Digital Currency and Digital Rights law" comes into force, which is expected in July 2026. The court's reservations highlight an internal debate over the legal foundation for such stringent measures.
The regulatory push occurs amidst turmoil in the local crypto sector, notably the recent hack of the Russia-based exchange Grinex, which lost over 1 billion rubles (about $13.7 million). This incident has intensified official discourse on the perceived insecurity of unregulated firms. If passed, the law would mark a significant shift, ending the current regulatory gray area and bringing the crypto industry under stricter government control and oversight.
