Moscow’s push to bring its cryptocurrency market under control has entered a new phase with the Russian government submitting a legislation to the State Duma that would make operating outside state-sanctioned crypto infrastructure a criminal offense.
Under the proposed law, any individual conducting cryptocurrency transactions without going through a licensed intermediary, meaning a state-regulated exchange, broker, or depository, would face up to four years in prison and a fine of approximately $4,000. The threshold rises sharply for those operating as part of an organized group or generating what the law classifies as large-scale income.
In those cases, penalties could reach upto seven years in prison or five years of forced labor, with fines climbing to one million rubles, roughly $13,100. If passed, the legislation would take effect on July 1, 2027.
The bill does not exist in isolation. It builds on a legislative campaign that began at least as far back as March of last year, when Russian authorities first moved to penalize illegal cryptocurrency mining. What started as targeted pressure on miners is now expanding into a broader attempt to route all crypto activity through channels the state can monitor and tax.
Russian government estimates suggest that around $129 billion worth of crypto assets currently operate beyond the reach of state regulators each year. As per estimates, daily transaction volumes are running at approximately 50 billion rubles.
Alongside the criminal bill, a separate proposal introduced on April 1 would require Russian residents to notify the Federal Tax Service whenever they open or close a foreign cryptocurrency wallet.
Under that measure, residents would also be obligated to report both their wallet holdings and associated transactions starting July 1 of this year. The proposal sits within a broader package of digital currency regulations that the government advanced in March.
Meanwhile, the Bank of Russia and the government are developing a legal structure that would allow established brokers and traditional exchanges to incorporate crypto services without needing to obtain separate licenses. The aim is to bring existing market participants into compliance without dismantling what has already become a functioning industry.
