Russia Targets Unlicensed Crypto Services

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Russia’s government has sent a bill to the State Duma that would create criminal penalties for unlicensed crypto service providers. The proposal would add a new Criminal Code article covering the illegal organization of digital currency circulation.

he draft targets intermediaries that offer storage, exchange, transfer, and transaction-related services for digital currency without a Bank of Russia license. If adopted, the criminal provisions would take effect on July 1 2027.

The Bill Focuses on Crypto Intermediaries

The proposed offense would apply when an unlicensed operator causes large damage or earns a large income from organizing digital currency circulation. Large damage or income would start at 3.5 million rubles, while especially large damage or income would start above 13.5 million rubles.

For the base offense, penalties would include a fine of 100,000 to 300,000 rubles, compulsory labor for up to four years, or imprisonment for up to four years. A tougher version would apply if the conduct involved an organized group or especially large damage or income, with prison terms of up to seven years and fines of up to 1 million rubles.

Bill Would Route Crypto Activity Through Licensed Firms

The criminal bill follows a broader draft law on digital currency and digital rights that the government submitted to the Duma on April 1. That bill defines key market terms and sets out which entities would be allowed to organize the circulation of digital currency and digital rights in Russia.

Under that framework, crypto activity involving Russian residents would run through licensed market participants, including trading organizers, brokers, trust managers, digital depositories and approved exchange organizations. The draft also says public circulation of digital currency in Russia would be allowed only if the asset is included on a Bank of Russia list.

The Supreme Court Raised Concerns

The bill has not moved through parliament without resistance. Russia’s Supreme Court gave a negative review, saying the government had not properly explained why a separate criminal article is needed when existing illegal business rules already cover activity carried out without a required license.

That objection leaves the proposal significant but still unresolved as lawmakers consider whether a separate criminal article is needed. Moscow is trying to turn crypto from a loosely tolerated market into a licensed financial channel, while the courts are questioning whether criminal liability is being added before the main digital currency framework is fully in place.