Russia’s Ministry of Justice is drafting new legislation to officially recognise cryptocurrency assets as property, a move that would allow law enforcement to confiscate them during criminal investigations. The proposed crypto law is aimed at cracking down on the growing use of digital currencies in illegal activities, including those linked to darknet markets.
Deputy Justice Minister Vadim Fedorov confirmed that the upcoming law will enable authorities to seize not only hardware wallets but also sensitive credentials such as seed phrases. The legislation will include protocols for the secure handling and storage of digital assets, with expert input to ensure proper procedures are followed.
Courts to Gain Authority to Block Crypto Wallets
The draft bill also proposes giving courts the power to freeze transactions and block digital wallets associated with suspected criminal activities. This measure targets the increasingly complex efforts by criminals to launder money using anonymous crypto channels.
Surge in Crypto Crime Sparks Legal Reform
The legislative push follows a marked increase in crypto-related crimes across Russia. Since the closure of Hydra, a major darknet market, platforms like Kraken have seen a 68% surge in crypto activity, much of it tied to illegal transactions. Authorities are now seeking to close loopholes that have made enforcement difficult in the digital currency space.
Fedorov noted that the anonymity and decentralisation of cryptocurrencies have made them particularly attractive to criminal networks. The new legislation is expected to play a key role in countering these challenges and aligning Russia’s legal framework with the realities of modern financial crime.
