Russian President Vladimir Putin has signed into law a comprehensive legal framework for digital assets, establishing a licensed cryptocurrency market under Bank of Russia oversight while preserving the country's prohibition on using digital currencies for domestic payments.

The legislation, set to take effect on September 1, 2026, marks Russia's first overarching regulatory structure for digital currencies and digital rights. It governs cryptocurrency exchanges, digital asset custody, mining, and investor participation. A licensing transition period for crypto service providers will run through July 1, 2027. The move places Russia among a growing set of jurisdictions—including the European Union under its MiCA framework, the United Arab Emirates, Hong Kong, and Singapore—that have moved from ambiguity toward formalized crypto oversight in recent years.

Licensed Crypto Market Under Central Bank Supervision

Under the new law, exchanges, brokers, and digital depositories will operate under the supervision of the Bank of Russia. Crypto service providers must register with the central bank and satisfy capital requirements before offering services to clients. The law also establishes rules for the organization, accounting, and custody of digital assets.

The framework represents a notable shift from the position the Bank of Russia took in early 2022, when it proposed a blanket ban on cryptocurrency mining and trading. Since then, Russian financial authorities have moved toward regulation, with officials citing the need to oversee activity already occurring and to facilitate cross-border settlements amid restrictions on Russia's access to global banking infrastructure.

Commercial banks will be tasked with monitoring transactions and may block transfers involving unauthorized crypto providers.

Retail and Qualified Investor Rules

The framework introduces a tiered system for market participants. Retail investors will face annual purchase limits of 300,000 rubles (approximately $3,800) through each licensed intermediary and must pass a knowledge assessment before they can trade digital assets. Retail participants will be restricted to trading highly liquid cryptocurrencies, with authorities currently recognizing assets such as Bitcoin, Ethereum, and USDT as meeting those liquidity standards.

Qualified investors who meet regulatory requirements will not be subject to annual investment caps and will have access to a broader range of cryptocurrencies.

Mining Recognized as Economic Activity

The legislation formally recognizes cryptocurrency mining as an economic activity. Registered companies may mine without restrictions. Individuals may continue mining provided they remain below government-established energy consumption thresholds. Russia ranks among the world's largest Bitcoin mining nations by hashrate, having absorbed capacity following China's 2021 mining crackdown.

Domestic Payment Ban Maintained

Despite the expanded regulatory framework, cryptocurrency cannot be used to pay for goods or services within Russia. The law preserves the domestic payment ban first introduced in 2022 and restricts advertising that promotes crypto as a domestic payment method.

Banks are expected to apply enhanced monitoring measures under the new framework. In certain cases, wallet transfers may be subject to a 48-hour cooling-off period as authorities intensify oversight of digital asset transactions.

Cross-Border Use Permitted

The law does allow cryptocurrencies to be used in foreign trade settlements and international investment activities. The legislation permits crypto use in foreign trade contracts and other approved cross-border transactions between Russian and foreign counterparties. Russian authorities continue developing alternative payment systems for international transactions while maintaining restrictions on domestic retail payments.

President Putin previously expressed support for blockchain technology and Bitcoin, stating: "For example, Bitcoin, who can ban it? Nobody." Nevertheless, the new legislation maintains strict controls over how digital assets function within Russia's domestic economy.

Digital Depositories and Ownership Recording

The framework also creates digital depositories responsible for recording ownership of digital currencies and related financial instruments. Russia continues to position digital assets primarily as instruments for international settlement rather than domestic commerce. With implementation phased over 2026 and 2027, market participants and foreign counterparties will be watching how the Bank of Russia's licensing requirements, capital thresholds, and enforcement mechanisms take shape in practice.