Russian Government Increases Scrutiny of Crypto Market to Trace, Prevent Tax Evasion

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The crypto market is under high scrutiny in Russia as the government there is trying to prevent people from evading taxes using these untraceable cryptocurrencies. During an interview, Danniil Egorov, the head of the Russian Federal Taxation Service (FNS) expressed concerns about the negative impact, cryptocurrencies could make in the national treasury if not monitored properly. According to Egorov, these decentralised crypto tokens are capable of causing “significant erosion” to Russia’s tax base. The FNS is now exploring ways of responding to crypto tax evasions as well.

“If we talk about cryptocurrencies, then we are now quite closely engaged in this market, realising that this system of calculations can create a fairly significant erosion for the tax base,” a report by Russian media RBC Group quoted the tax official as saying on Monday, November 22.

Revealing plans of installing automated tracking systems to process big data volumes, Egorov said that it is only a matter of time that the “untraceable” link that makes the crypto space unique, would become traceable.

“Technologies are used, anonymisation is used in terms of providing services by various fraudsters, of course. When you get into the digital space, you still leave a trail somewhere. And it’s a matter of time before this trail is identified,” the FNS official added.

Presently untraceable in nature, cryptocurrencies are decentralized digital finance system where records are maintained using cryptography, and not any bank or physical intermediary.

As of January 1, 2021, cryptocurrencies were declared “allowed” in Russia — but not to be used as an exchange for goods and services. Russians can mine, trade and hold cryptocurrencies — but using them as a payment option can push people behind the bars, as per a report by Forbes.

While the Russian government has spoken about creating the country’s own regulated digital currency, holding undeclared cryptocurrency between $1,300 (roughly Rs. 97,500) and $13,000 (roughly Rs. 9.7 lakhs) is a finable and jail-time offence in the nation.

Regulating Cryptocurrency Around the World

Along with Russia, other nations are also looking at ways to stitch taxation with cryptocurrencies.

In India, for instance, the federal finance ministry has formed a new committee to find out if income made by cryptocurrency trading could be taxed.

Earlier this month, US President Joe Biden also signed a new law which includes tax reporting provisions that apply to cryptocurrencies.

Meanwhile, the cryptocurrency market is booming internationally. Presently, the global crypto market capitalisation is around $2.9 trillion (roughly Rs. 2,15,66,720 crore) as per the data by CoinMarketCap.


Interested in cryptocurrency? We discuss all things crypto with WazirX CEO Nischal Shetty and WeekendInvesting founder Alok Jain on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music and wherever you get your podcasts.Affiliate links may be automatically generated – see our ethics statement for details.
Shiba Coffee Company Burns SHIB Tokens for Every Bag of Coffee It Sells

Shiba Coffee Company Burns SHIB Tokens for Every Bag of Coffee It Sells

Shiba Inu’s (SHIB) mainstream popularity has skyrocketed over the past few weeks and the crypto coin’s strong community has now introduced a one-off token-burning mechanism which invites coffee lovers from across the world to show their support. Launched earlier this month, the Shiba Coffee Company sells a variety of SHIB-branded coffee at a starting price of $16.99 (roughly Rs. 1,262). Customers can buy their coffee in SHIB too, of course, and 10 percent of the company’s proceeds are then directed towards SHIB burning.

The Shiba Inu community, or the ShibArmy, already has a host of community-driven token burning projects and the Shiba Coffee Company is the latest to join the fray. These include the SHIB Burner playlist and the Bricks Buster mobile game. These projects, however, only exist in the digital world. The Shiba Coffee Company, on the other hand, intends to remind people of their “favourite local coffee roaster” and connect the digital world of Shiba Inu with a physical product.

“Bridging the digital community that SHIB has created with the physical world is key to making a lasting impact and movement,” a company spokesperson said. “When people can touch and smell something, they can feel that this isn’t just something online.”

Coin burning is essentially the act of sending cryptocurrency tokens to a wallet that has no access key, eventually taking them out of circulation. This reduces the overall number of tokens in circulation, making tokens scarce and boosting the cryptocurrency’s valuation.

The spokesperson also goes on to talk about how the ShibArmy community’s burning efforts were commendable, saying it shows “how strong the SHIB community is.” The most recent burn event hosted by the larger ShibArmy was the Shiba Burn Party in which 1 billion Shiba Inu tokens (worth $46,280/ roughly Rs. 34.3 lakh) or 0.0000018 percent of the circulating supply were destroyed.

Other than marketing its coffee, the Shiba Coffee Company’s website features the names of companies which contribute towards burning SHIB. A number of companies have already pledged to burn a portion of their profits in support of the token burn. Among them are Bigger Entertainment and The Vibe Maquillage which will burn 20 percent of royalties and 15 percent of all sales in SHIB, respectively.

Since the company only recently launched, it is yet to complete any planned burn event but the company does intend to host a burn event once every month, details of which will be shared on its website.


Interested in cryptocurrency? We discuss all things crypto with WazirX CEO Nischal Shetty and WeekendInvesting founder Alok Jain on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music and wherever you get your podcasts.