Russia will place the risk of foreign stablecoin freezes on investors under new cryptocurrency legislation that expands reporting, testing, and oversight requirements across the country's digital asset market.

Deputy Finance Minister Ivan Chebeskov outlined the framework in remarks to Russian news agency TASS. He said the has approximately 20 million cryptocurrency users, and that Russian citizens hold roughly RUB 3.7 trillion ($44 billion) in cryptocurrency and related products. Daily cryptocurrency transactions total about RUB 50 billion ($595 million).

Under the new rules, foreign issuers may render foreign stablecoins such as USDT or USDC — widely used dollar-pegged tokens issued abroad — unstable, which can result in investors losing their assets. Those losses would not necessarily fall on a Russian depository, meaning investors would absorb the impact if an overseas issuer freezes a token.

Russia Expands Cryptocurrency Reporting Requirements

Chebeskov said Russian tax residents are required to declare transactions with cryptocurrencies that are not part of the regulated system. The requirement will also apply to transactions with addresses that are not controlled by Russian digital depositories.

According to the rules adopted, Russian depositories continue to record, store, and transfer digital assets. They are required to keep proper records and to ensure that a client's assets are not disposed of without permission. Foreign issuers, however, remain subject to the laws of their home countries. If an overseas issuer blocks an asset, the Russian depository would not automatically pay investors.

Chebeskov said the regulatory approach was developed over more than 10 years of discussions. Authorities began with a prohibition policy, then progressed to partial regulation and experimental policies. Russia later adopted an experimental legal regime for certain activities with digital currency, and the authorities are now taking steps toward more thorough regulation of cryptocurrencies.

The government also reduced the proposed capital requirement for independent crypto exchanges, lowering the minimum from RUB 30 million to RUB 15 million. Chebeskov differentiated this activity from the ordinary transactions of citizens with their own cryptocurrency, noting that the classification would depend partly on profits made or damage done.

The framework will also include tax reporting. Residents are required to report the relevant transactions within 180 days of the Federal Tax Service's approval of the reporting procedures.

Foreign Stablecoins Create Additional Investor Risks

The stablecoin issue has become prominent because foreign issuers can control blockchain-based assets. Tether earlier froze USDT worth $28 million that was linked to Garantex, a Russian exchange under sanctions — a freeze carried out at the token level, leaving the funds on-chain but unmovable by their holders. Russian authorities therefore consider issuer-controlled stablecoins to be a threat not only to the crypto market but also to the country's financial system, and those risks can arise even while assets remain on blockchain networks.

Investors who use potentially blockable cryptocurrencies would need to meet further requirements, Chebeskov said. Qualified investors are required to take a test and verify their comprehension of the relevant risks. The proposed framework would also subject non-qualified investors to testing, with their purchases through a single intermediary limited to RUB 300,000 annually.

Russia has not yet finalized a separate framework for stablecoins that can be used domestically. The Finance Ministry and the Bank of Russia are considering various models and the risks associated with them.

Authorities are also seeking more information on cryptocurrency activity within Russia. The majority of the market currently sits outside the regulated system, making accurate measurement difficult. The new system may offer more information regarding cryptocurrency possession and activity.

Foreign stablecoin bans may continue to represent a significant threat to Russian investors. Russia's crypto holdings, estimated at $44 billion, illustrate the scale of that exposure. As regulation evolves, investors will have to become familiar with the risks that are not covered by domestic protections. Near-term steps to watch include the Federal Tax Service's approval of the reporting procedures, which starts the 180-day declaration window, and the Finance Ministry and Bank of Russia's review of models for stablecoins that can be used domestically.