Self-custodial wallet / non-custodial software in Russia
Publisher of software where users hold their own private keys. The publisher never holds, controls, or has access to user funds.
Self-custodial wallet is conditionally permitted in Russia without local incorporation, subject to AML obligations and none licensing burden.
Verdict Details
- Permitted
- conditional
- Local entity required
- No
- Licensing burden
- None
- Last updated
- 2026-07-13
AML Obligations
- No AML obligations attach to the publisher of self-custodial wallet software because the publisher never holds, controls, or accesses user funds – AML/KYC obligations under Russian law (Federal Law No. 115-FZ) apply to intermediaries (exchangers, custodians, depositories) not to software publishers.
- AML obligations (Rosfinmonitoring oversight, transaction monitoring, de-anonymization procedures) apply only to licensed intermediaries, not to non-custodial software providers.
Key Restrictions
- The wallet software must not provide any custody, exchange, or conversion services – those trigger licensing/registration requirements with the Bank of Russia.
- The software must not facilitate domestic crypto payments for goods/services (prohibited under the 2020 Law on Digital Financial Assets).
- The publisher must not route users through Russian-licensed intermediaries or offer exchange functionality without a license.
- No geofencing of Russian residents is required by law, but the wallet should not hold or control keys.
Key Risks
- Regulatory ambiguity: Russia's evolving crypto laws (2020 DFA Law, proposed 2026 framework) focus on intermediaries and custodians – software publishers without custody fall in a gray area.
- Criminal liability risk: If the software is deemed to facilitate unlicensed digital currency circulation, the publisher could face fines ($1,300–$13,000) or imprisonment (4–7 years) under criminal liability rules for unlicensed operations.
- The proposed 2026 framework could introduce unexpected classification changes, such as deeming wallet software as a 'DFA operator' if integrated with exchange features.
Evidence
This verdict synthesizes the following facts. Each fact links to its primary source(s).
Bank of Russia (Central Bank of the Russian Federation): Establishes AML regulations for financial institutions, supervises compliance, issues and revokes licenses based on AML adherence, and provides guidance on AML best practices. The Bank also proposes crypto-specific rules and maintains registration of digital financial asset operators.
Rosfinmonitoring (Federal Financial Monitoring Service): Russia's lead agency for combating money laundering and terrorist financing. It analyzes financial transactions, ensures institutional compliance with AML/CFT standards and Federal Law No. 115-FZ, and enforces Enhanced Due Diligence requirements.
Exchanges: Licensed entities with Russian legal status (crypto exchanges, brokers, fiduciary managers) are required. Banks and brokers can obtain crypto exchange licenses via a simplified notification process tied to existing financial permits, subject to prudential requirements set by the Bank of Russia.
Custody Providers: Specialized digital depositories must be licensed or registered in the Bank of Russia's register to maintain records of cryptoasset rights and register wallets. They face restrictions like no lending of client assets and no liability for blockchain malfunctions or issuer blocks.
Mandatory licensing for intermediaries: Covers digital exchanges, custodial services, trading platforms, and DFA operators; banks, brokers, and securities firms can provide services after authorization.
Criminal liability for unlicensed operations: Entities organizing digital currency circulation without Bank of Russia approval face fines ($1,300–$13,000), up to 4–7 years imprisonment, or forced labor; applies to exchanges and large operators.
2020 Law on Digital Financial Assets (DFAs): Legalizes crypto transactions but prohibits use as payment for domestic goods/services; mandates reporting of transactions over 600,000 rubles to tax authorities.
Rosfinmonitoring (Federal Financial Monitoring Service): Handles anti-money laundering (AML) and counter-terrorism financing (CFT); monitors transaction data from crypto providers.
Bank of Russia (Central Bank of Russia): Primary regulator; proposes/implements rules, supervises financial institutions, registers digital financial asset (DFA) operators, establishes experimental regimes, and bans domestic crypto payments.
Prohibitions: No domestic payments with crypto; reporting mandatory for large transactions. International trade exception since 2024.
Verdict Attribution
- Source:
- AI-Generated · Unreviewed
- AI synthesized:
- 2026-07-13 (deepseek-chat)
- Last updated:
- 2026-07-13
- Confidence:
- medium
This verdict was produced by an AI model from the underlying facts. Confirm with counsel before relying on it for material decisions.
Conditional — publishing self-custodial wallet software that never holds keys or controls funds does not trigger Russian VASP/MSB/licensing obligations, as Russia's crypto regulations target intermediaries, custodians, and exchangers, not software publishers; however, the publisher must avoid any custody, exchange, or domestic-payment facilitation features to stay outside the licensing net, and faces risk from Russia's broad criminal-liability provisions for unlicensed crypto circulation.
Questions this verdict aims to answer
- Does software publishing trigger VASP / MSB classification?
- Do AML obligations attach when no custody exists?
- What disclosure or consumer-protection rules apply?