Russian prosecutors to get power to seize crypto, but there’s a catch.

The Russian Prosecutor-General plans to allow investigators to seize cryptocurrency and liquidate criminals’ tokens, with the Treasury hoping to benefit from the proceeds.

However, legal experts have raised concerns that the plan could face difficulties when prosecutors attempt to liquidate the seized coins.

In April, the media outlet Vedemosti first reported on the Prosecutor-General’s proposals. Madina Dolgieva, the judiciary director at the Prosecutor-General’s Office, stated that a change in rules would likely be possible “without legislative amendments.” This is because amendments would require parliamentary approval. It appears that the plan has progressed since April, as Stavropol Plus reported this week.

An academic expert suggested that confiscated crypto funds would likely be sent to the Treasury. However, the expert also noted that converting tokens to fiat may prove problematic. The media outlet quoted Diana Bersey, an Associate Professor at the Stavropol branch of the Russian Presidential Academy of National Economy and Public Administration, who explained that changes to the criminal code would not be required if done through a government decree. However, Bersey also stated that laws on enforcement proceedings would need to be amended to allow the Federal Bailiff Service to sell the seized coins.

Cryptocurrency still has no legal status in Russia. However, previous court rulings in civil and criminal cases have seen judges rule that coins have “property” status. Experts claim that prosecutors could adopt a similar view to tokens, allowing them to be seized as “assets.” Dolgieva claimed that the existing “confiscation mechanism” could be tweaked to allow “investigating authorities” to “open their own cryptocurrency accounts and wallets.” These wallets could be used to hold coins while waiting for court approval to liquidate.

Russian Prosecutors to Be Given New Crypto Powers – What Else Is Moscow Planning?

Russian lawmakers say they are hopeful of legalizing the use of tokens in international trade. They also hope to legalize industrial crypto mining before the end of the year. However, the Central Bank of Russia, which is skeptical of cryptocurrency, could pose challenges. Earlier this month, a security firm claimed that almost $300 million worth of cryptocurrency trades per day were being offered on Russia’s fast-growing P2P market.

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