Rosfinmonitoring is preparing a new wave of cryptocurrency regulation: full identification and the Travel Rule
The Russian digital currency market is facing a serious tightening of the rules. Rosfinmonitoring has announced a package of amendments that will radically change the approach to controlling crypto operations. First and foremost, the new requirements will affect market participants providing brokerage and trust management services: they will be obliged to conduct full client identification, as well as disclose information about ultimate beneficiaries and beneficial owners.
However, the regulator has also provided mechanisms to reduce operational burdens. Crypto exchanges and digital depositories will be allowed to delegate identification functions to commercial banks and professional securities market participants. This, apparently, should facilitate the entry of small players into the legal field.
Control expands: five new types of operations in the crosshairs
The list of operations subject to mandatory control will be expanded by five new categories related to cryptocurrency turnover. A key innovation will be the integration of the digital depository into the system of information support for transfers. This is directly linked to the implementation of the Travel Rule standard, which is already in effect in the European Union and most FATF jurisdictions. From now on, every crypto transaction must be accompanied by end-to-end information about the sender and recipient, effectively eliminating the anonymity of transfers.
It is important to emphasize that some of the requirements are already enshrined in current legislation. For example, the current version of Federal Law No. 115 classifies transactions with digital financial assets (DFAs) worth 1 million rubles or more as operations subject to mandatory control. Banks, brokers, and digital depositories are already authorized to block suspicious transfers. Control over foreign trade operations, where digital rights are used as consideration, is also separately regulated.
Why is this happening right now?
The need for this initiative is directly linked to the upcoming assessment of the Russian AML system by the FATF. The goal is to bring national regulation in line with international standards and "decriminalize" the cryptocurrency and digital asset market. As the updated FATF Assessment Methodology shows, the global focus has shifted from the formal existence of laws to the actual effectiveness of law enforcement. Countries are now not just required to adopt laws—they must demonstrate strict oversight of the industry and enforcement of the Travel Rule in practice to avoid being placed on the "grey list."
The innovations will finally come into force after the adoption of the bill "On Digital Currency and Digital Rights," which has so far passed only its first reading.
My comment: The Russian regulator is consistently moving towards a model of complete control over the crypto market, copying the approaches of the FATF and the EU. For bona fide participants, this means the emergence of clear rules of the game and a legal field for business. However, for those accustomed to anonymity and grey schemes, dark times are coming—the "shadow exchange" is becoming a thing of the past. The only question is how flexible the law enforcement practice will be and whether excessive rigidity will lead to an outflow of liquidity to unregulated platforms.