Rosfinmonitoring tightens the screws: new identification and control rules for the crypto market
Russia's financial monitoring regulator is preparing fundamental changes to the rules for working with digital currencies. It has become known that new participants in the crypto industry, including brokers and trustees, will be required to conduct full client identification, as well as disclose information about ultimate beneficiaries and beneficial owners. This is a significant step toward legalization, but within strict boundaries.
To reduce the administrative burden on crypto exchanges and depositories, the possibility of delegating identification functions to commercial banks and professional securities market participants is provided. However, the key innovation is the expansion of the list of transactions subject to mandatory control. It will include five new types of transactions related to cryptocurrencies. At the same time, the digital depository is planned to be integrated into a unified system for information support of transfers.
Travel Rule and FATF: Pressure on Russia Intensifies
Special attention is paid to the implementation of the Travel Rule standard. Now, each crypto transaction will be accompanied by end-to-end information about the sender and recipient. Similar requirements are already in effect in the European Union and most jurisdictions following FATF recommendations. In essence, Russia is seeking to bring its AML system into compliance with international standards ahead of the upcoming FATF evaluation.
Some of the norms are already enshrined in current legislation. For example, the current version of Federal Law No. 115 classifies transactions with digital financial assets worth 1 million rubles or more as operations subject to mandatory control. Banks, brokers, and digital depositories receive the right to block suspicious cryptocurrency transfers. Control over foreign trade operations, where digital rights are used as counter-performance, is separately stipulated.
The innovations will come into force only after the adoption of the bill "On Digital Currency and Digital Rights," which has so far passed only its first reading.
Cryptalist Expert Opinion: These measures are not just a bureaucratic formality. Russia is under close scrutiny by the FATF, and being placed on the "gray list" would be a catastrophe for the entire financial system. The regulator is forced to demonstrate strict oversight, but for bona fide market participants, this is a chance for transparent operations. However, small players unwilling to bear compliance costs will be pushed into the shadows. The market is heading for consolidation.