Russian Bankers Reportedly Trying to Criminalize Non-Custodial Cryptocurrency Wallets

However, the Russian Banking Association appears to be opposed to allowing consumers to control their own cryptocurrencies. Due to the "serious problem" of acquiring cryptocurrencies from debtors and criminals, the association's vice president Anatoly Kozlachkov has devised a framework for foreclosing on cryptocurrencies kept in non-custodial wallets.

The framework, developed in cooperation with the Ministry of the Interior, proposes criminal liability for failure to hold cryptocurrencies such as Bitcoin (BTC) in non-custodial wallets. The organization also advocates making it a crime to refuse to provide keys to authorized institutions.

The organization reportedly sent a letter in mid-April with proposals to provide the framework to a number of institutions and regulators, including the Bank of Russia and the Federal Financial Supervisory Service.

Banks say their programs are challenged by technical problems associated with forcing access to non-custodial wallets without the consent of their owners due to the anonymity of the owners and the technical complexity of accessing such wallets. This makes forced confiscation of such assets almost impossible," the report said.