Government Requests Crypto Wallets, Access to Exchanges: Russian Prosecutors

Russian Prosecutors have indicated that their departments are having trouble collecting digital assets they have confiscated. They have also asked the government to recognize cryptocurrencies as property and to grant authorities access to digital wallets.

Prosecutor’s Office Argues For Investigators to Have Cryptocurrency Wallets

Prosecutors in Russia are calling for investigative agencies, as well as other government departments, to be allowed to open crypto wallets. These wallets would be used to store and convert confiscated digital currency into fiat money, according to a report from the Kommersant Business daily.

At a roundtable discussion on e-justice, participants from the Attorney General’s Office’s Main Judicial Department were told that the office has always supported the acknowledgement of digital assets as property that can be seized if it was obtained illegally. The speaker, Madina Dolgieva, noted that courts make inconsistent decisions regarding cryptocurrency property, although some do recognize it as such.

Cryptocurrencies are still not fully regulated in Russia, with current law “On Digital Financial Assets” taking effect in 2021 and addressing only a limited number of questions. The legislature has been reviewing a bill that would introduce amendments to the State Duma, the lower house of the Russian legislature.

For instance, the confiscation of a physical wallet with virtual assets is just half the job, as the cryptocurrency still needs to be withdrawn, according to Madina Dolgieva. She stressed that this is where the problems start, as domestic exchanges are not yet authorized and foreign platforms cannot be used by the prosecution.

The prosecutor argues that it is necessary for investigating authorities to be able to open their wallets to convert cryptocurrency. This is particularly true due to the increased amount of this currency after the Russian government imposed restrictions on fiat transfers to foreign countries in February of this year.

Despite the suggestion, the Central Bank of Russia and the government oppose the legalization of crypto transactions in the country. The bill was supported by the monetary authority, however, imposing a requirement that mining rewards are not exchanged outside of the country, or only under certain “experimental legal regimes” within Russia.

Consider the possibility of the Russian government giving investigators access to crypto wallets and digital asset exchanges. Share your thoughts in the comments section below.