Authorities in Russia look for legal options to confiscate the virtual assets of cybercriminals, including cryptocurrencies. The goal is to be able to do the same thing that is now possible with traditional property forms.
It was the Ministry of Internal Affairs that declared it aims to develop the legislation needed to allow the law agencies to make criminals hand over the digital gains that were ill-gotten. Proposals are expected to be in by the date of December 2021, based on an RBC report.
Other parties involved in the development of the needed laws are The Prosecutor General’s Office, The Federal Customs Service, The Justice Ministry, Rosfinmonitoring, The Supreme Court and The Federal Security Service.
The problem in Russia is that crypto asset regulations are held up in the parliament. There is no official legal definition for cryptos. In order for forfeiture to happen, cryptos have to be legally defined, maybe as commodities. With the definition not in place, nothing can be done by law officials.
Besides what was already mentioned, there are also other problems that can appear. Regulators know how difficult it is to confiscate cryptocurrencies in different wallets, especially when they are protected by user passwords and encryption.
Even so, the Russian authorities think they can work with the crypto exchanges in order to freeze and isolate funds. This statement was made by State Duma’s Nikita Kulikov.
In addition, the Russian agencies need to develop their crypto wallets so as to find a way for the digital assets to be exchanged to fiat. State crypto-ruble and crypto-exchange accounts have to be set up so that funds can be withdrawn and then used.
Law enforcement in Russia is behind when it comes to understanding cryptocurrency. The central bank seems indifferent. There is no desire to launch the digital ruble based on internal research done by the Central Bank. With all this in mind, it can take a lot of time to see the needed laws for law enforcement forces to seize cryptocurrencies.