Russia is taking a stricter stance on crypto regulation, with lawmakers introducing a new bill that would impose criminal penalties on individuals and businesses offering unregistered crypto services.

The proposed legislation aims to tighten oversight of the digital asset sector by requiring all operators to obtain approval from the country’s central bank.

Licensing Requirement for Crypto Activity

Under the draft law submitted to the State Duma, anyone involved in organizing or facilitating digital currency circulation must register with the Bank of Russia.

Failure to do so could result in legal consequences, including fines and potential prison sentences.

The move reflects a broader effort by authorities to bring crypto-related activities under formal regulatory control.

Penalties Include Fines and Prison Time

The bill outlines penalties for unregistered activity, with individuals facing fines of up to $4,000 and prison sentences of up to four years.

More severe punishments apply to organized groups or cases involving large-scale financial damage or profits. In such cases, offenders could face up to five years of compulsory labor or as much as seven years in prison.

Additionally, courts could impose fines of up to 1 million rubles, or an amount equivalent to several years of income.

Part of Broader Regulatory Push

This proposal builds on earlier legislative efforts introduced in March, which included criminal penalties targeting illegal crypto mining operations.

Together, these measures signal Russia’s intent to establish tighter control over the crypto industry as it evolves.

Legal Concerns Raised by Supreme Court

Despite the government’s push, the bill has already drawn criticism.

Russia’s Supreme Court reportedly questioned the need for criminal penalties, stating that the proposal lacks sufficient justification.

The court also suggested the move may be premature, as the country’s broader “Digital Currency and Digital Rights” law is not expected to take effect until July.

Increasing Oversight of Crypto Sector

If passed, the legislation would significantly expand the government’s ability to monitor and regulate crypto-related activities.

Authorities appear focused on reducing risks tied to unregulated platforms while ensuring that digital asset services operate within a defined legal framework.

Industry Risks Highlighted by Recent Hack

The regulatory push comes as security concerns continue to affect the crypto sector in Russia.

Local exchange Grinex recently halted trading after suffering a hack that resulted in losses of more than $13 million.

The incident has been reported to law enforcement and is under investigation, further underscoring the risks associated with unregulated or vulnerable platforms.

Payward, the parent company of crypto exchange Kraken, has announced plans to acquire US-based derivatives exchange Bitnomial in a deal valuing the company at $20 billion.

The move signals a major push into regulated crypto derivatives in the United States, with Bitnomial’s licenses playing a central role in the acquisition.

Regulatory Edge Drives Acquisition

Bitnomial stands out as the first crypto-native exchange in the US to hold all three key licenses from the Commodity Futures Trading Commission (CFTC): exchange, clearinghouse, and brokerage approvals.

According to Payward, this regulatory positioning was a primary factor behind the deal.

Kraken co-CEO Arjun Sethi emphasized that Bitnomial’s infrastructure was built specifically for digital assets, rather than adapted from traditional systems. This includes crypto-native settlement, collateral handling, and 24/7 trading capabilities.

Expanding Crypto Derivatives in the US

With the acquisition, Payward plans to leverage Bitnomial’s infrastructure to expand its product offerings for US clients.

This includes spot margin trading, perpetual futures, and options, all within a regulated framework.

The company also aims to enhance its institutional services, allowing businesses to integrate crypto features such as trading, tokenized stocks, derivatives, and fiat onramps through its API.

Kraken Deepens Institutional Strategy

The deal follows a series of strategic moves by Kraken to strengthen its presence in traditional finance.

This includes expanding into tokenized equities and derivatives, as well as securing a limited-purpose master account with the US Federal Reserve.

The account allows Kraken to access the Fed’s payment systems, enabling more direct settlement of transactions without relying on intermediaries.

Access to Federal Reserve Infrastructure

Kraken’s approval for a Federal Reserve master account, granted by the Kansas City Fed, marked a milestone for the crypto industry.

It provides access to the Fedwire system, which is typically used by banks and financial institutions for real-time payments.

However, the account comes with limitations, including a one-year term and certain operational restrictions.

Building a Native Crypto Market Structure

Payward’s acquisition of Bitnomial reflects a broader trend of building crypto-native financial infrastructure within regulated environments.

By combining Bitnomial’s licensing and trading systems with Kraken’s existing platform, the company aims to offer a more comprehensive suite of services tailored to both retail and institutional users.

As regulatory clarity improves in the US, such moves could help bridge the gap between traditional finance and digital asset markets.

France’s finance minister, Roland Lescure, has voiced support for a euro-pegged stablecoin initiative led by European banks, as the region looks to compete with the dominance of US dollar-backed tokens.

The proposed stablecoin, known as Qivalis, is expected to launch in the second half of 2026 under the European Union’s Markets in Crypto Assets regulatory framework.

Europe Pushes for Digital Euro Alternatives

The Qivalis project was introduced in September 2025 by a group of major European banks, including ING and UniCredit.

Its goal is to create a MiCA-compliant euro stablecoin that can serve as a regional alternative to widely used dollar-backed digital assets.

Lescure expressed strong support for the initiative, stating that Europe needs its own competitive offering in the stablecoin space.

Dollar Stablecoins Still Dominate

Currently, the stablecoin market is heavily dominated by US dollar-pegged assets.

Tether’s USDT and Circle’s USDC account for the vast majority of market share, with USDT alone holding a market capitalization of around $186 billion.

By comparison, euro-backed stablecoins represent only a small fraction of the market, which Lescure described as “not satisfactory.”

Tokenized Deposits Also Encouraged

In addition to stablecoins, Lescure encouraged banks to explore tokenized deposits as part of the broader digital finance shift.

These instruments, which represent traditional bank deposits on blockchain infrastructure, could play a complementary role alongside stablecoins in modernizing financial systems.

Europe Focuses on Regulation and Stability

European regulators are taking a structured approach through the MiCA framework, aiming to ensure compliance, transparency, and financial stability.

At the same time, officials remain cautious about certain features, particularly interest-bearing stablecoins.

Banque de France Governor François Villeroy de Galhau has warned that offering yield on stablecoins could pose risks to financial stability, a concern echoed by policymakers in both Europe and the United States.

Ongoing Debate in the US

The discussion around stablecoins is also ongoing in the US, where lawmakers are still debating how to regulate the sector.

The proposed CLARITY Act, which aims to establish a market structure for crypto assets, remains stalled in the Senate amid disagreements over issues like stablecoin yield and tokenized equities.

Europe Looks to Close the Gap

With initiatives like Qivalis, Europe is positioning itself to reduce reliance on dollar-based stablecoins and strengthen the role of the euro in digital finance.

As competition intensifies, the development of regulated, region-specific stablecoins could play a key role in shaping the future of global payments.