Russia's push forward with cryptocurrency legislation could pave the way for criminal penalties.

Russia's State Duma, the lower house of parliament, passed draft bill No. 1194918-8, entitled "On Digital Currency and Digital Rights," on Tuesday. This bill aims to establish the core legal framework for digital currencies in Russia, directing cryptocurrency trading to licensed intermediaries regulated by the Bank of Russia. According to the bill, Russian residents can purchase cryptocurrencies through approved intermediaries as early as July, while unlicensed platforms will be banned by July 2027. The bill introduces restrictions on retail investment, stipulating that only highly liquid digital currencies are permitted for purchase. Relevant assets must meet criteria such as an average market capitalization exceeding 5 trillion rubles (approximately $66.66 billion) over the past two years, an average daily trading volume exceeding 1 trillion rubles (approximately $13.33 billion), and at least five years of trading history. Retail investors must pass a test, and the annual purchase limit through a single intermediary is 300,000 rubles (approximately $4,000). Furthermore, the bill allows residents to purchase cryptocurrencies through foreign accounts, but requires reporting to the tax authorities, and explicitly prohibits the use of cryptocurrencies for payments.