Country overview

#77

Russia

Country stats

Rating Points

145

This indicator describes the overall rating of a given jurisdiction on several parameters according to cryptocurrency operations - market volume, crypto regulation, business climate, taxation framework.

Crypto Penetration

6.7%

Estimated percentage of crypto users out of the country's total population based on public data.

Legal Entities

Number of crypto companies registered in the country based on regulator data if available or other types of public data.

Regulation Points

An overall assessment of the granularity of crypto regulation in a given country. A high score is also given to countries where cryptocurrency transactions are highly regulated.

Amount of crypto users

9 607 800

Total amount of crypto users out of the country's total population based on public data.

Taxation points

This figure, according to our analysts' calculations, indicates the overall level of tax burden for cryptocurrency transactions in a given country. The higher the indicator, the lower the burden.

Market volume points

183.7

A rough estimate of this jurisdiction's retail crypto market relative to the rest of the world. The higher the indicator, the higher the market potential.

Status of crypto

Legally allowed

General status of cryptocurrency regulation in this jurisdiction.

Crypto payments

Ban

The legal status of cryptocurrency payments for goods and services in a given country based on information from regulators, public data and feedback from our community.

Security Level

Considerable danger

The overall level of security in a given country based on open data.

Crypto Salaries

Ban

The legal status of cryptocurrency salaries to employers in a given country based on information from regulators, public data and feedback from our community.

Business Climate

Difficult

Overall assessment of the friendliness of this country for crypto-business. This indicator takes into account the cost of obtaining a license and the attitude towards crypto entities in the country.

Stablecoin Regulation

None

This indicator is evaluating the regulation of stablecoins in a given country. Complex regulation means that it is possible to issue steiblcoins and obtain a license for this activity. Basic regulation means that the issuance of stablecoins is possible, but not all legal aspects are defined in the law. Standard regulation means that there is a legal practice of steylcoin circulation in a given country.

Bad Factors

Sanctions

This section describes the unfavorable economic factors for crypto-business in a given country. These are countries that are under sanctions or on the FATF grey list and other factors.

Types of licenses

De facto

Cryptocurrency exchange is conditionally legal in this jurisdiction, but no licensing procedure is yet. Registering a legal entity here and performing exchange operations through it without a license is possible.

Good

Medium

Bad

intro

Russia still lacks transparent regulation of cryptocurrencies, but it is unofficially quite influential in this field. In addition, it has already imposed basic crypto regulation.

Security level

Russia's security level is a considerable danger in our rating. It has 61.3 points (from 100) for safety in Numbeo crime rating (1). The homicide level (2) is 6.8 per 100,000 inhabitants a year.

Crypto Payments

Crypto payments in Russia are officially prohibited based on federal law №259 “On digital financial assets” (3). The law was adopted on July 31, 2020. This law prohibits using cryptocurrencies as a means of payment on the territory of the Russian Federation.

At the same time, small and medium enterprises in Russia use crypto payments unofficially. Among other things, these solutions are used in foreign trade activities to circumvent sanctions (4).

Crypto Salaries

The use of cryptocurrencies as a means of payment on the territory of the Russian Federation is prohibited. Therefore, payment of labor in cryptocurrencies, especially on an official basis, is not permitted.

However, there is a loophole in Russian legal practice, namely, if one citizen pays off with another citizen of the Russian Federation on the territory of another jurisdiction, and cryptocurrency is used for settlements not on the part of Russia. Still, between Russian citizens, then, it may be possible. However, as we said above, using crypto as a means of payment on Russian territory is prohibited. This means that Russian legal entities cannot legally use cryptocurrency to pay salaries.

Legal

In Russia, cryptocurrencies for a very long time were regulated under Federal law № 259 “On digital financial assets” (5), which was approved by Russian parliament in 2020. There is no such term as "cryptocurrency" in the law itself, but there is the concept of a “digital financial asset” and “digital currency.” This law authorizes Russian citizens to hold digital currencies and clarifies the procedure for their taxation. Within the framework of this law, crypto exchanges and mining companies couldn't legally operate on the territory of the Russian Federation. At the same time, dozens of foreign crypto exchanges and local crypto exchange points openly operated in Russia without any license and sometimes without any legal bodies. Local exchange points mostly provided crypto to cash exchange (or cash to crypto).

However DFA law created legal basis for crypto taxation and operations of DFA providers. These companies issue various digital rights on the blockchain - for example, shares and bonds. In principle, such a license can be equated to security tokens and STO (security token offering license). You can find more information about the current status of digital financial assets in Russia and their regulation on the Bank of Russia site (6). Based on it, there are already 17 organizations that can issue digital financial assets (aka security tokens). The Moscow Exchange has become the first platform for listing DFA (7) in the beginning of 2024, including real estate DFA (aka real estate security tokens).

Great progress in the field of crypto regulation started in 2024. From the 1st November 2024 mining companies can legally operate in Russia under "Mining Law №221" (8), which allows this type of business, but requires to sell mined crypto inside Russia, pay taxes and register in special Miners list.

Taxation

Tax name	Index
PIT tax Max	15
PIT tax Min	13
Corporate tax (CIT)	20
Max Individual CGT (for crypto)	20
Min Individual CGT (for crypto)	20
Wealth tax Min	0
Wealth tax Max	0

The DFA Law regulates (8) the taxation of cryptocurrencies and promises Russians the protection of their property rights to cryptocurrency only when it is declared. If you receive income from the sale of digital assets, the tax base will be calculated as the difference between their purchase and sale prices. This taxation framework was confirmed in 2024 by legislation updates (9) regarding "taxation of digital currency". For individuals' income from crypto operations standard PIT rate is applied, as for legal bodies - CIT rate.

PIT

The Tax Code of the Russian Federation provides a few tax rates for personal income tax: 13% - 15%. Different tax rates are established for types of income and categories of taxpayers based on The Federal Tax Service.

CGT

According to the Federal Tax Service, the primary capital gains tax rate is (10) 20%. However, for individuals' crypto income standard PIT rate is applied.

CIT

The basic corporate income tax rate is (11) 20% per the Federal Tax Service.

Links

1)Crime Index by Country 2023 Mid-Year

2)List of countries by intentional homicide rate

3 and 5)Federal Law "On digital financial assets, digital currency and amendments to certain legislative acts of the Russian Federation" dated July 31, 2020, N 259-FZ (latest edition). Russian version.

4) Russian founder of sanctioned exchange Garantex starts Tether desk. Article

6)Digital financial assets and their operators. Bank of Russia

7)Tokenized real estate to be issued on the Moscow Exchange in 2024. Article
8)Сonsultant Mining Law

8)Mining, trading, and taxes. How is the crypto market regulated in Russia? Article

9)Russian State Duma. Law № 1065710-7

10 and 11) Corporate Income Tax and Capital Gain Tax (CIT and CGT). Federal Tax Service

Last update: November 2024

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intro

Russia still lacks transparent regulation of cryptocurrencies, but it is unofficially quite influential in this field. In addition, it has already imposed basic crypto regulation.

Security level

Russia's security level is a considerable danger in our rating. It has 61.3 points (from 100) for safety in Numbeo crime rating (1). The homicide level (2) is 6.8 per 100,000 inhabitants a year.

Crypto Payments

At the same time, small and medium enterprises in Russia use crypto payments unofficially. Among other things, these solutions are used in foreign trade activities to circumvent sanctions (4).

Crypto Salaries

Legal

Taxation

Tax name	Index
PIT tax Max	15
PIT tax Min	13
Corporate tax (CIT)	20
Max Individual CGT (for crypto)	20
Min Individual CGT (for crypto)	20
Wealth tax Min	0
Wealth tax Max	0

PIT

CGT

According to the Federal Tax Service, the primary capital gains tax rate is (10) 20%. However, for individuals' crypto income standard PIT rate is applied.

CIT

The basic corporate income tax rate is (11) 20% per the Federal Tax Service.

Links

1)Crime Index by Country 2023 Mid-Year

2)List of countries by intentional homicide rate

4) Russian founder of sanctioned exchange Garantex starts Tether desk. Article

6)Digital financial assets and their operators. Bank of Russia

7)Tokenized real estate to be issued on the Moscow Exchange in 2024. Article
8)Сonsultant Mining Law

8)Mining, trading, and taxes. How is the crypto market regulated in Russia? Article

9)Russian State Duma. Law № 1065710-7

10 and 11) Corporate Income Tax and Capital Gain Tax (CIT and CGT). Federal Tax Service

Last update: November 2024