Russian authorities have gone back on their idea to penalize whoever is caught in bitcoin operations in the country, says a report by Russian news agency Interfax.

Though Interfax referenced unnamed sources close to the Russian government’s financial departments, it suggested that representatives from the country’s Ministry of Finance, the central bank, and other government bureaus are increasingly supportive of this action.

The Finance Ministry had planned to submit legislation in May that would punish those who use digital currencies with fines as high as $38,000 and jail sentences of up to seven years, according to media reports.

The Ministry of Justice and the Interior Ministry in Russia had reportedly questioned the “public danger” that bitcoin supposedly brings, as proposed by the Finance Ministry.

Sources had said that the Ministry of Justice was in disagreement with some of the wording of the bill proposing a ban on money “surrogates” as a term that has frequently been associated with bitcoin and virtual currencies.

In Moscow, in 2014 Deputy Finance Minister Aleksey Moiseev had told journalists that:

People can play with their chips, and they can call them money, but they can’t use these surrogate currencies as tender. We will discuss this law in the current session of parliament, and possibly even pass it then, or at the very latest by spring next year. We are currently dealing with comments from the law enforcement agencies, about the specifics of legal measures, and we will take their remarks into account. But the overall concept of the law is set in stone.

Russia had wanted to join the number of countries including Bolivia, Iceland, and Vietnam which have taken steps to criminalize bitcoin despite its growing popularity and opposing criticisms that such regulations won’t work.

The Finance Ministry’s proposal had been to prohibit the issuance of all cryptocurrencies or their use in exchange for goods and services in Russia.

Later, Russia’s media regulator blockaded bitcoin-related sites. Roskomnadzor blocked five websites, including popular cryptocurrency community bitcoin.org, sponsored by the Bitcoin Foundation, and entered them into its blacklist of banned websites.

The rationale for the ban on cryptocurrencies is that they facilitate money-laundering and other forms of digital and ‘real world’ criminal activity.

Bitcoin’s use has been under threat in Russia as its legal status has grown murkier over the course of the past year. In January 2014, Russia’s Central Bank (CBR) issued a statement, warning against the use of virtual currencies due to potential ties to “money laundering or terrorist activities.” The Central Bank also said that bitcoin usage was illegal under Russian federal law.

The reversal, as it seems now, will end two years of speculation that Russia would seek to actively discourage the use of cryptocurrencies and other “money surrogates” through administrative fines and labor penalties.

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