In a landmark move signaling a major shift in its digital asset policy, Russia’s State Duma passed a new law on July 30, 2024, during its second and third readings. The legislation paves the way for the use of cryptocurrency in cross-border transactions and exchange trading, effective September 1, 2025. This development marks a significant evolution in Russia’s approach to digital currencies—transitioning from strict caution to regulated experimentation and integration.
The new law introduces the Digital Currency Instrument (ЭПР) framework, granting legal structure to crypto-based financial activities while maintaining tight state oversight. Under this framework, digital assets can now be used in foreign trade settlements and traded on authorized exchanges—provided they operate within the ЭПР system approved by the Central Bank of Russia.
This shift reflects not only technological adaptation but also strategic recalibration in response to ongoing geopolitical and economic pressures.
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Evolution of Russia’s Cryptocurrency Policy
Early Caution and Regulatory Hesitation (Pre-2017)
Prior to 2017, Russian authorities viewed cryptocurrencies with deep skepticism. The Central Bank of Russia consistently warned the public about the risks associated with digital assets, particularly their potential use in money laundering, terrorist financing, and other illicit activities. Bitcoin and similar assets were seen as speculative instruments with no intrinsic value and high volatility.
At that stage, there was no legal recognition of crypto assets, and no formal regulatory framework existed. Government discussions focused primarily on risk containment rather than innovation or adoption.
First Steps Toward Legal Recognition (2019–2020)
A turning point came in 2019 when Russia began exploring regulatory pathways for digital assets. However, disagreements emerged between key institutions: the Ministry of Finance advocated for a balanced, innovation-friendly approach, while the Central Bank pushed for stricter controls—even proposing a full ban on private cryptocurrencies (as reported by The Moscow Times).
In 2020, Russia adopted the Digital Financial Assets Law (DFA Law), which formally recognized cryptocurrencies as property under civil law. While this was a major step forward in terms of legal clarity, the law maintained a critical restriction: digital currencies could not be used as payment for goods or services.
Despite this limitation, the DFA Law laid the foundation for future regulation by requiring crypto exchanges and wallet providers to register with financial authorities and comply with anti-money laundering (AML) and counter-terrorism financing (CFT) standards.
Growing Institutional Tensions and Presidential Intervention (2022)
By 2022, tensions between the Central Bank and the Ministry of Finance had intensified. The Central Bank reiterated its stance favoring a complete ban on private cryptos, citing national security and financial stability concerns. In contrast, the Ministry emphasized the economic potential of blockchain technology and Russia’s competitive edge in crypto mining due to low energy costs.
It was at this juncture that President Vladimir Putin intervened, urging both sides to find a compromise. He highlighted Russia’s growing role in global cryptocurrency mining and stressed the need to harness digital innovation without compromising sovereignty or financial integrity.
This intervention set the stage for the current legislative breakthrough—the ЭПР framework.
Key Provisions of the New Cryptocurrency Law
The newly passed law centers around the ЭПР (Digital Currency Instrument) mechanism, which functions as a regulated sandbox for crypto-enabled financial operations.
1. Cross-Border Payments Now Permitted
One of the most significant changes is the allowance of cryptocurrency for foreign trade settlements. Previously banned under Russian law, digital assets can now be used to pay for international goods and services—but only within approved ЭПР schemes.
Each ЭПР proposal must clearly define:
- Rights and obligations of participants
- Roles of foreign exchange control bodies and agents
- Procedures for monitoring compliance
This creates a controlled environment where crypto is not freely circulated but strategically deployed in external economic activity.
2. Exchange Trading of Cryptocurrencies Authorized
The law also permits cryptocurrency trading on regulated exchanges, provided such platforms operate under an authorized ЭПР framework. Exchanges must establish clear procedures for:
- Listing and delisting digital assets
- Transaction execution rules
- Participant eligibility
This opens the door for institutional-grade crypto markets in Russia, though access remains tightly supervised.
3. Central Bank as Primary Regulator
Under the new law, the Central Bank of Russia assumes primary regulatory authority over all ЭПР-related activities. It has the power to:
- Approve or reject ЭПР schemes
- Monitor operators for risks to national security
- Collaborate with Rosfinmonitoring (Federal Financial Monitoring Service), FSB (Federal Security Service), and the Ministry of Finance
Notably, if any threats related to money laundering, terrorism financing, or national defense are detected, the Central Bank must report them within 10 days.
Furthermore, the Central Bank may develop a digital currency platform based on Russia’s National Payment System (NPS), setting operational rules and technical standards for operators.
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Why This Matters: Geopolitical and Economic Implications
Russia’s pivot toward regulated crypto usage cannot be understood without considering the broader context of international sanctions.
Since 2022, Western nations have imposed sweeping financial restrictions on Russia, including:
- Disconnecting major banks from SWIFT
- Freezing central bank reserves
- Limiting access to U.S. dollar-dominated financial infrastructure
These measures have severely disrupted Russia’s ability to conduct international transactions, prompting urgent efforts to build alternative payment channels.
The ЭПР framework represents one such innovative workaround—a state-controlled system that leverages blockchain technology while minimizing exposure to external oversight. By enabling cross-border crypto payments through trusted intermediaries and regulated instruments, Russia aims to reduce dependency on traditional banking networks.
Moreover, this move could position Russia as a pioneer in sovereign-managed digital finance, blending decentralization with centralized control—a model some other sanctioned or emerging economies may follow.
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Frequently Asked Questions (FAQ)
Q: When does the new Russian crypto law take effect?
A: The law officially comes into force on September 1, 2025, allowing cryptocurrency use in cross-border trade and regulated exchange trading under the ЭПР framework.
Q: Can Russians now use Bitcoin to buy everyday goods?
A: No. Despite the new law, cryptocurrencies remain prohibited as payment for domestic goods and services. Their use is limited to approved international transactions within the ЭПР system.
Q: Is this a full legalization of crypto in Russia?
A: Not entirely. While it's a major liberalization, crypto operations are confined within strict regulatory boundaries. Full decentralization or unrestricted use is not permitted.
Q: Who regulates cryptocurrency activities under the new law?
A: The Central Bank of Russia is the primary regulator, responsible for approving ЭПР schemes, monitoring compliance, and coordinating with security agencies.
Q: Could this help Russia bypass Western sanctions?
A: Partially. While not a complete solution, the ЭПР system offers a controlled mechanism for conducting international payments outside traditional banking channels, reducing reliance on SWIFT and USD settlements.
Q: Are foreign investors allowed to participate in Russian crypto exchanges?
A: Participation depends on individual ЭПР scheme approvals. However, given current sanctions and capital controls, access for most Western investors remains highly restricted.
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