Russia advances sweeping bill to regulate crypto

TLDR

Russia has taken a major step toward tightly regulated crypto use that enables sanctioned foreign trade but keeps everyday domestic crypto payments illegal.

1. The State Duma approved the first reading of the On Digital Currency and Digital Rights bill, putting crypto under Bank of Russia licensing and recognizing it as property.
2. The framework bans domestic crypto payments, caps retail buying, restricts trading to a few very large coins, and will phase out unlicensed and peer to peer platforms.
3. The law permits crypto for explicitly cross border trade, potentially easing sanctions pressure, with final text and related criminal penalty bills due before a planned launch in July 2026.

Deep Dive

1. Core Features Of The New Bill

Russias State Duma passed the first reading of bill 1194918-8 On Digital Currency and Digital Rights with 327 of 340 votes, creating a comprehensive framework for issuing, trading, and storing crypto under Bank of Russia supervision. The bill classifies cryptocurrencies as property, allowing them to be recognized in court for bankruptcy and divorce, but keeps the ruble as the only legal tender for domestic payments, so in country purchases in crypto remain prohibited. The framework relies on licensed intermediaries such as exchanges, brokers, depositories, and exchangers, all overseen and limited by the central bank, and is targeted to take effect on 1 July 2026 if it passes further readings and is signed into law.

2. How It Changes Crypto Use Inside Russia

For Russian residents, access becomes legal but heavily constrained. Non qualified (retail) investors must pass a test and face an annual purchase cap of about 300,000 rubles (around 3,900 to 4,000 dollars) per intermediary, while professional investors have no limit. Only the most liquid coins defined by the Bank of Russia will be allowed on organized venues, with draft criteria requiring roughly 5 trillion rubles in average market cap, 1 trillion rubles in daily volume, and five years of trading history, which in practice favors Bitcoin and maybe a handful of mega caps. Trading must go through licensed platforms, with a broad ban on unlicensed platforms and peer to peer transactions scheduled from 2027, and parallel bills seek fines and prison terms for running unlicensed digital asset services.

3. Sanctions, Cross Border Flows, And What To Watch

The bills most geopolitically significant feature is that it explicitly permits the use of cryptocurrencies for foreign trade settlements while keeping domestic payments illegal. Officials present this as a way for Russian companies to pay and get paid in Bitcoin or other approved assets when traditional routes like SWIFT or dollar clearing are blocked, and some lawmakers openly frame this as a way to circumvent sanctions restrictions. This follows reports of large Russia linked stablecoin flows and an existing pilot where domestically mined bitcoin is used for energy and commodity exports. Key next steps include the second and third readings in the Duma, Federation Council review, presidential signature, final rules on which assets qualify, how mining and custody will be policed, and whether criminal penalty bills are softened after the Supreme Court flagged them as premature.

Conclusion

Russia is moving from a legal grey zone to a tightly controlled crypto regime that keeps monetary sovereignty at home while deliberately opening a regulated channel for sanctioned cross border trade. For global crypto, it reinforces Bitcoin and a few large caps as state level settlement tools, but also sharpens the focus of regulators elsewhere on sanctions evasion and centralized choke points such as licensed exchanges and custodians.