Source: iStock/LaraBelova

Adding to the legal uncertainty surrounding cryptocurrency in Russia, the country’s Ministry of Internal Affairs has confirmed earlier reports that it is cooperating with the Russian Supreme Court and a number of other federal institutions to prepare draft legislation that would allow the authorities to confiscate cryptocurrency, with plans to submit a proposal by the end of 2021, reports local news agency TASS.

The institutions involved in the preparation of the new regulations are to include a plethora of law enforcement, judicial and financial entities. These comprise the Federal Financial Monitoring Service (Rosfinmonitoring), the Office of the Prosecutor General, the Ministry of Justice, the Federal Customs Service, the Investigative Committee, and the Federal Security Service.

Many of Russia’s federal institutions, such as the country’s Central Bank, remain wary of cryptocurrencies which they view as a challenge to state power. In late November, the bank told state-run news agency RIA Novosti it would support a national ban on cryptocurrency payments, as they “carry significant risks, including those in the field of laundering the proceedings of criminal activities and financing terrorism”.

Meanwhile, work on legislation designed to clarify the legal status of cryptocurrencies is lagging behind. As previously reported, Russian Prime Minister Dmitry Medvedev had set the Duma, the country’s parliament, a deadline of 1 November for the finalization of the "On Digital Assets" bill which passed its first reading in May 2018. Despite this, Russian lawmakers yet again postponed the deliberations on the much-awaited regulations.

Also, as Russia's crypto legislation is taking a confusing shape, local experts do not rule out that it might effectively stop Russians from legally trading in Bitcoin (BTC), Ethereum (ETH) and other major altcoins on regulated domestic exchanges.

In related recent news, as the Australian Federal Police are developing their tech capacities, a recent drug bust of a property in Western Australia allowed officers from the Technology Crime Service to seize not only illegal substances, but also more than AUD 1.52 million (USD 1.04 million) worth of unspecified cryptocurrency on an electronic device.