Russian Regulators Find Common Ground — Bitcoin Can’t Be Used for Payments

Russian authorities are yet to reach full consensus on the future of cryptocurrencies but government institutions are on the same side of the fence in their intention to ban bitcoin payments. Other operations with digital assets are to be legalized and regulated, representatives of Russian business have revealed.

Russian Central Bank, Finance Ministry Agree to Prohibit Crypto Payments

The Central Bank of Russia, the Ministry of Finance and the government have converged on the question of how to regulate Russia’s crypto space. Decentralized digital currencies will not be accepted as a means of payment, the head of the Russian Union of Industrialists and Entrepreneurs (RSPP) Alexander Shokhin told reporters following a meeting devoted to digitalization.

Last month, Bank of Russia urged for a wide-ranging ban of crypto-related activities, including their use in payments, exchange and mining. The hardline policy proposal was met with opposition from other institutions, including the finance ministry which came up with its own vision of how cryptocurrencies should be treated. Siding with the treasury’s stance, the federal government adopted a plan which favors regulation over prohibition.

“It is already clear that both sides in this discussion have generally come closer. In particular, if we are talking about prohibitions, then that is rather about a ban on the use of cryptocurrency as a means of payment, while other aspects are subject to regulation,” Shokhin was quoted as saying by the daily Izvestia. According to the government-approved regulatory concept, coins can be bought, exchanged, and sold, the report notes

Vladimir Potanin, co-chairman of RSPP’s Coordinating Council and president of Nornickel, noted that the regulatory bodies are still seeking agreement on the details of Russia’s crypto framework but he emphasized that all of them support a ban on the use of cryptocurrency as a legal tender.

“The business community has reached an understanding with the government, the central bank and lawmakers that cryptocurrencies are more complicated and difficult to regulate than digital financial assets,” the billionaire elaborated, quoted by Forklog.

While regulating certain aspects of the crypto economy such as the issuance of tokens, the Russian law “On Digital Financial Assets,” which went into force in January of last year, left many unanswered questions. A working group at the State Duma, the lower house of parliament, is now preparing legislation to fill the gaps.

A new law introducing comprehensive rules for the circulation of cryptocurrencies in Russia, based on the finance ministry’s proposals, is expected by Feb. 18. Earlier this week, the chairman of the Financial Market Committee Anatoly Aksakov announced that a draft is already on his desk. Deputies plan to adopt it during the spring session of the Duma.

Do you expect Russia to regulate cryptocurrencies by the parliament’s summer recess? Tell us in the comments section below

Indian Parliament Member Clarifies Legal Status of Cryptocurrency

Cryptocurrency is currently a gray area in India. It is neither legal nor illegal. A parliament member, India’s finance secretary, and the minister of finance have recently clarified the legal status of cryptocurrency in India.

Legal Status of Crypto in India

Following the finance minister’s announcement to tax cryptocurrency income, the question of whether crypto is now legal or legitimate in India has come up repeatedly.

Union Minister of State for Finance Bhagwat Karad, a member of Rajya Sabha, India’s upper house of parliament, reportedly explained Saturday that cryptocurrency is not legal in India.

He told reporters that both the government and the central bank, the Reserve Bank of India (RBI), have not given any recognition to cryptocurrencies, therefore they are not legal in India right now.

However, he is not saying that the legal status of crypto will remain this way, emphasizing that what happens in the future regarding its legal status cannot be said at this time.

Minister Karad’s statement echoes one made by the Indian finance minister, Nirmala Sitharaman, last week. She said the government is not going to legalize or ban cryptocurrency at this stage, stressing that the decision of whether to ban crypto will come after she receives input from various consultations.

Crypto Currently Neither Legal nor Illegal in India

While Minister Karad said cryptocurrencies are not legal in India, the Indian government has noted repeatedly that they are also not illegal.

Finance Secretary T. V. Somanathan, for example, said earlier this month that crypto assets are currently not illegal. However, he stressed that investments in them are not encouraged either, elaborating:

They are in a gray area. They are not illegal. It’s not illegal to buy or sell crypto assets in India, and it continues to be not illegal.

Meanwhile, the finance minister has made it clear that income from cryptocurrency transactions will be taxed. However, the crypto industry is petitioning for the government to reconsider the 30% taxation proposed in the budget.

Minister Karad added Saturday:

There is information that some people have invested in cryptocurrencies. Thus, 30% tax has been proposed on [crypto] transactions in the Union Budget.

The Indian government is reportedly consulting widely with many stakeholders regarding crypto regulation. The finance minister also said that the government is constantly monitoring the crypto sector.

A cryptocurrency bill was listed to be considered in the winter session of parliament but it was not taken up. The government is now reportedly reworking the bill.

What do you think about how India is treating crypto? Let us know in the comments section below.

NH Governor Signs Executive Order to Bring 'Regulatory Certainty' to Cryptocurrency Industry

The governor of the U.S. state of New Hampshire has signed an executive order establishing a commission on cryptocurrencies and digital assets. “Federal and state governments must work to bring legal and regulatory certainty to the digital asset industry because clear rules of the road foster technology and innovation,” said the governor.

NH Executive Order on Cryptocurrency

Governor Chris Sununu of New Hampshire announced last week that he has signed an executive order establishing “the governor’s Commission on cryptocurrencies and digital assets.”

The Commission will focus on several key areas, including:

Reviewing and investigating the current status of United States federal and state laws and regulatory rules, and laws of other non-United States jurisdictions, applicable … to banks and other businesses that provide services with respect to cryptocurrencies and other digital assets.

The governor explained: “New Hampshire is a hub of financial innovation, and this executive order will further our commitment to attracting high-quality banking and financial businesses in a safe and responsible manner.” He stressed:

Federal and state governments must work to bring legal and regulatory certainty to the digital asset industry because clear rules of the road foster technology and innovation.

Members of the Commission shall include the Attorney General, the Commissioner of the Bank Department, one state senator, one state representative, and “three public members with recognized experience with cryptocurrencies,” the order details.

The Commission will hold public hearings to hear testimony regarding the development of cryptocurrency and digital asset economies.

In addition, it will make recommendations for specific modifications and improvements to laws and regulations applicable to cryptocurrency.

According to the executive order, “No later than 180 days from the date of this order, the Commission shall submit a report containing its findings, determinations, and recommendations to the governor, the speaker of the House, and the president of the senate.”

What do you think about this executive order by the New Hampshire governor? Let us know in the comments section below.

Canadian Lawmaker Introduces Bill to Encourage Crypto Sector Growth

A bill has been introduced in Canada to encourage the growth of the crypto sector. “Canada should be attracting billions of dollars in investment in the fast growing crypto asset industry. Today I introduced a bill, the first of its kind in Canada, to make sure this becomes a reality,” said the parliament member who introduced the bill.

Bill to Grow Crypto Sector Launched in Canada

Canadian parliament member Michelle Rempel Garner introduced “Bill C-249” on Wednesday, which “may be cited as the Encouraging the Growth of the Cryptoasset Sector Act,” according to the text of the bill.

Conservative MP Garner tweeted:

Canada should be attracting billions of dollars in investment in the fast growing crypto asset industry. Today I introduced a bill, the first of its kind in Canada, to make sure this becomes a reality.

The bill requires Canada’s minister of finance “to develop a national framework to encourage the growth of the cryptoasset sector.” In addition, it requires the minister “to consult with persons working in the sector.”

The lawmaker explained that government officials are discussing and setting policies on crypto assets. However, she pointed out that many lawmakers are not deeply familiar with what crypto assets are, how they function, or their big potential for economic growth.

“To be a world leader, Canada needs to make sure crypto asset experts and investors are telling us what policies they need, or what policies they don’t need,” she emphasized. “This bill requires the minister of finance to formally ensure that their voices help lead policy development.”

The bill details:

Within three years after the day on which this Act comes into force, the minister must prepare a report setting out the framework and must cause the report to be tabled in each House of Parliament on any of the first 15 days on which that House is sitting after the report is completed.

According to the website set up to explain the legislation, the bill does not establish any particular policy for the regulation of cryptocurrency. “Instead, this bill creates a mechanism to formally engage the expertise of cryptoasset talent in policy development so that their voices lead the way. It ensures that the experts have a say in what policy they need, or don’t need,” the website describes.

What do you think about this bill? Let us know in the comments section below.

S&P 500 FALLS ALMOST 2% BELOW 4420 ON REPORTS OF RUSSIA'S INVADING UKRAINE AS REPORTED BY US PRESS

11 February 2022, 23:49

• The S&P 500, the Dow Jones, and the Nasdaq Composite fell between 1.43% and 3.07%.
• Ukraine/Russia conflict escalation points towards a Russia’n invasion as reported by US press, confirmed by the US Security Advisor.
• Market sentiment was dismal, as safe-haven flows like gold, the USD, and the yen dominated the end of the week.
• Western Texas Intermediate finished the week above $93.10 per barrel as geopolitical tensions arose.

On Friday, US equities dropped sharply as recent geopolitical chatter linked to the Ukraine – Russia conflict. US news sources said that a Russian invasion of Ukraine was imminent, spurred a flight to safe-haven assets. 

As the New York session ends, the S&P 500 drops 2.05%, at 4,410.85. The Dow Jones Industrial falls some 1.45%, at 34,729.63, and the tech-heavy Nasdaq Composite slides 3.17%, sits at 14.230.95.

Sector-wise, energy (boosted by rising oil prices) and utilities advance 2.79% and 0.01% each, while the biggest losers are technology, consumer discretionary, and communications, sliding 3.01%, 2.82%, and 2.54%, respectively.

US press wires report that Russia decided to invade Ukraine

Around 18:30 GMT, according to a PBS NewsHour reporter, “the US believes that Russian President Vladimir Putin has decided to invade Ukraine and already communicated those plans to the Russian military. Two Biden administration officials said they expect the invasion to begin as soon as next week.”

The reporter continued “that US defense officials anticipate a “horrific, bloody campaign” that begins with two days of bombardment and electronic warfare, followed by an invasion, with the possible goal of regime change. Reportedly, the North Atlantic Council was briefed on the new intel today.”

The US National Security Advisor confirms the rumors

Later in the day, rumors were confirmed by National Security Advisor Jake Sullivan. He said, “we are in the window where a Russian invasion of Ukraine could begin at any time and could happen during the Beijing winter Olympics.” Furthermore, he added that “the US continues to see signs of escalation at the border, and would respond decisively should Russia invade.”

Jake Sullivan urged all Americans in Ukraine to leave “as soon as feasible.” Moreover, Sullivan said, “we are not saying Putin has made a final decision, but Russia now has all forces it needs to conduct a major military action, but he did clarify a false flag operation is also possible by Russia.”

As Wall Street closed, it crossed the wires the news that the US President Joe Biden and Russia’s Vladimir Putin would talk over the phone on Saturday,  per Via citing the Kremlin.

Putting the geopolitical jitters aside, the greenback got bid, with the US Dollar Index, advancing close to 0.50%, reclaiming 96.05, linked to safe-haven flows. US Treasury yields fell in the bond market, led by the 10-year yield down eleven basis points, below 2% at 1.916%, a tailwind for precious metals.

At the same time, gold rises 2% exchanges hands at $1864.44 a troy ounce, while US crude oil benchmark, WTI, hit $93.10 per barrel amid revived Ukraine invasion concerns going into the weekend.

In the FX Market, the EUR/USD got hammered by the crisis, trading at 1.1345, while the GBP/USD barely unchanged at 1.3550 got a boost from higher UK’s GDP numbers. Concerning safe-haven pairs, the USD/JPY failed to cling to the 116.00 figure influenced by safe-haven flows, trades at 115.31, while the USD/CHF finished at 0.9243.