Russian President Vladimir Putin has signed a new law formally granting courts and law enforcement agencies the authority to seize cryptocurrency assets such as Bitcoin during criminal investigations.
- Russia now treats crypto as property, allowing courts to seize and confiscate digital assets in criminal cases.
- Authorities can take control of wallets, hardware devices, and request cooperation from exchanges.
- Retail investors will face strict annual purchase limits, while exchanges must obtain domestic licenses or risk being blocked.
- Crypto remains banned for domestic payments but may be used for cross-border settlements.
The legislation, approved in late February 2026, amends both the Criminal Code and the Criminal Procedural Code, marking a significant step in Moscow’s broader effort to tighten control over the digital asset sector.
Under the new framework, digital currencies are now legally classified as “intangible property.” This reclassification allows crypto holdings to be included in criminal case materials, frozen during investigations, and ultimately confiscated to satisfy court rulings or civil claims.
How the Seizure Process Will Work
The law outlines specific procedures for handling digital assets. Investigators must document the exact type of cryptocurrency involved, the quantity seized, and the wallet addresses connected to the suspect. Authorities are also empowered to confiscate physical devices such as servers, computers, and hardware wallets.
Where technically feasible, officials can transfer seized coins to secure, government-controlled wallet addresses. The legislation also creates a formal legal pathway for Russian agencies to request cooperation from foreign crypto exchanges when attempting to freeze or retrieve assets.
The law is expected to enter into force ten days after official publication. Additional executive regulations will follow, defining storage standards and operational procedures for managing confiscated funds.
Part of a Broader Regulatory Overhaul
The enforcement-focused measure comes ahead of a sweeping national crypto framework scheduled for completion by July 1, 2026. That framework will transition Russia from its current experimental regime to a permanent two-tier system for digital asset oversight.
Retail investors classified as “non-qualified” will face strict purchase caps of 300,000 rubles per year – roughly $4,000. Access will be limited to high-liquidity tokens likely to include Bitcoin and Ethereum, with other large-cap assets such as Solana or TON potentially eligible depending on central bank approval.
Qualified investors who meet income or asset thresholds will not face volume limits, but even they will be barred from trading privacy-focused coins such as Monero, Zcash, and Dash.
All participants will likely be required to pass a mandatory risk-awareness test before gaining access to the market.
Exchanges Face Licensing and Blocking Rules
The legislation also targets intermediaries. All exchanges, brokers, and crypto trust managers must obtain special licenses to operate domestically. Major Russian financial institutions, including Moscow Exchange, are preparing for the launch of regulated crypto services.
Beginning in July 2026, Russia’s internet regulator is expected to block foreign exchanges that fail to establish local subsidiaries or register under domestic law. By July 1, 2027, unlicensed intermediary activity will carry criminal penalties, including heavy fines and prison terms of up to seven years for organized violations.
Authorities estimate that Russian users currently generate roughly $15 billion annually in transaction fees on foreign platforms. The new rules aim to redirect that activity back into the domestic financial system.
Payments Still Banned – But Cross-Border Use Expands
Despite the tightening oversight, the law maintains the long-standing ban on using cryptocurrency for domestic payments, a restriction first introduced in 2021. From 2026 onward, illegal crypto payments inside Russia may trigger asset confiscation and substantial fines.
However, in a notable shift, digital assets and stablecoins may be used legally for cross-border settlements and foreign trade operations. Russian residents can still purchase cryptocurrency through foreign accounts, but such holdings must be reported to the Federal Tax Service.
Implementation Challenges Ahead
Enforcement will not be straightforward. Authorities must prove that a specific wallet belongs to a suspect, a task complicated by blockchain anonymity and offshore platforms. Cooperation is likely to be more effective with exchanges operating inside Russia or in allied jurisdictions such as China or CIS countries.
Decentralized exchanges pose a particular challenge, as there is no central entity to compel. Some experts suggest that, if enforcement proves ineffective, regulators may eventually consider blocking or banning access to decentralized platforms altogether.
With the new seizure powers now codified, Russia is moving decisively toward a tightly supervised crypto environment – one that permits investment and cross-border utility, but under firm state oversight and with clear consequences for non-compliance.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
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Source: https://coindoo.com/russian-president-vladimir-putin-signs-law-allowing-crypto-confiscation/
