Russian lawmakers have opened a new phase in the country’s digital-asset crackdown by submitting legislation that would impose criminal liability on unregistered crypto service operators and increase penalties for illegal mining. The draft marks a clear escalation from regulatory signalling to punitive enforcement, with fines, compulsory labour and prison terms now positioned as core tools for reshaping how crypto businesses operate inside Russia.
The proposal, submitted to the State Duma on April 17, 2026, targets entities that organize digital-currency circulation without authorization from the Bank of Russia. Under the draft, individuals could face fines of up to $4,000 and prison sentences of as much as four years, while more serious cases involving organized groups or substantial financial harm would carry fines of up to 1 million rubles, compulsory labour for up to five years or imprisonment for up to seven years. The structure of the bill shows that lawmakers are treating unauthorized crypto activity as a systemic compliance threat rather than a peripheral market offense.
Unlicensed Trading and Custody Face a Higher Legal Risk
The most immediate impact would fall on exchanges, brokers and custodial operators that serve Russian users without explicit domestic approval. If enacted, the law would create a much narrower operating perimeter in which Bank of Russia licensing becomes the decisive threshold for legal market participation. That shift would increase compliance costs for firms still relying on cross-border servicing models and could force some market participants to reassess whether Russia remains commercially viable under the tighter framework.
The enforcement logic is also tied to a broader policy objective. Central Bank Governor Elvira Nabiullina described the package as a necessary bulwark against fraud and as a way to improve market transparency by penalizing unregulated transactions. That framing suggests the state is trying to recast enforcement as a market-cleaning exercise rather than a blanket anti-crypto campaign, even though the practical result will likely be a more restrictive environment for private operators.
Mining Is Becoming a Parallel Target
The crackdown is not limited to trading and circulation services. On April 14, 2026, the State Duma also advanced in first reading a related bill that would impose administrative penalties on illegal mining, including fines of up to $20,000 and confiscation of equipment. Lawmakers cited more than 8,000 illegal mining operations identified since 2019 as justification, reinforcing the idea that mining is now being treated as an enforcement priority alongside exchange activity.
That matters because mining enforcement affects more than local operators. Equipment seizures, tighter permit expectations and higher penalties could reduce the flow of locally mined coins into the market and introduce new supply-side friction for counterparties that rely on Russian-linked liquidity. In that sense, the mining provisions have implications for treasury management and settlement flows as well as for industrial operators themselves.
The Market Now Has a Defined Adjustment Window
The legislative timeline gives firms some room to adapt, but not much certainty. Lawmakers are expected to push for adoption of the broader law by July 1, 2026, with full enforcement of penalties projected to begin roughly one year later. That creates a finite restructuring window in which exchanges, custodians and treasury teams can still reconfigure counterparties, licensing assumptions and settlement routes before legal exposure sharpens further.
Even so, the debate inside Russia is not entirely settled. The Supreme Court has reportedly cautioned that criminal liability may be premature until the broader legal framework is finalized, a sign that concerns remain about sequencing and proportionality. But unless that resistance significantly slows the bill, the direction of travel is already clear: Russia is moving toward a more centralized, permissioned crypto market in which unlicensed activity carries materially higher legal and operational risk.