Russia Proposes 7-Year Hard Labour for Unlicensed Crypto Trading: New Bill Details

Russia’s government has proposed a sweeping new bill that would criminalize the buying and selling of cryptocurrencies without a central bank-issued operating permit, potentially resulting in up to seven years of forced labour for violators.

The draft legislation, published on the State Duma’s website, introduces criminal liability for activities related to the organization of digital currency circulation without proper registration or a special permit. This move comes as Russia seeks to bring its largely unregulated crypto sector—estimated at $648 million in daily transactions—under legal oversight as early as June.

Key Provisions of the Bill

Mandatory Licensing and Restrictions

Under the proposed law, most Russian crypto traders would be required to conduct transactions exclusively through commercial bank apps, effectively eliminating the country’s grey-area crypto exchanges. The bill defines the “organized” selling of cryptocurrencies without a central bank license as a criminal offence.

The government argues that these measures will enhance transparency in crypto markets and “reduce the risk of financial crime.”

Penalties for Offenders

The bill outlines tiered penalties based on the scale of the violation:

• Individuals: Minimum fine of $1,300, with a maximum fine capped at $4,000. Courts may also impose forced labour terms of up to four years.
• Crypto Exchange Operators: Fines up to $13,000. Executives could face imprisonment of five to seven years.
• Crypto Miners: Penalties for industrial miners who fail to declare their activities to the state.

Comparison to Earlier Proposal

The current bill is a revised version of a previous proposal introduced in the State Duma on April 1, as reported by Russian media outlet Expert. The earlier draft included even stricter measures, such as requiring all Russian residents to notify the Federal Tax Service within a month of opening or closing crypto wallets held overseas. It also proposed mandatory reporting of all transactions on overseas crypto exchanges to the same tax body.

Next Steps and Implementation

Both the current and earlier bills require approval from the State Duma and the President’s office. If enacted, the legislation would take effect on July 1, 2027.

For tips or inquiries, contact Tim Alper, News Correspondent at DL News, at [email protected].