Russian Court Takes Crypto Exchange Binance off Website Blacklist

Binance, the biggest cryptocurrency exchange by trading volume, has persuaded a Russian court take its website off a regulator's blacklist.

The site has been blocked since June, when a court in the Arkhangelsk region ruled in favor of local prosecutors, saying the company was helping distribute information about bitcoin and that the cryptocurrency is unregulated.

"Issuance and usage of bitcoins are fully decentralized, and there is no way to regulate it by the government, which contradicts the current Russian law," the September court decision read.

However, Binance wasn't notified about the court hearings and only found out that it was blacklisted by the Internet censorship agency Roskomnadzor three months later, according to Gleb Kostarev, Binance's Russian representative. This prevented the exchange from being able to properly defend its rights in court.

After Binance challenged the decision, requesting the appropriate process, the prosecutors withdrew their complaint, the new court ruling, seen by CoinDesk, indicates.

Cryptocurrencies like bitcoin are not illegal in Russia. The country's law on digital assets, which came into force on Jan. 1, recognizes cryptocurrencies as taxable property and regulates the issuance of centralized digital tokens in the country. President Vladimir Putin has also signed an order that civil servants must report their crypto holdings.

Read more: Ruble or Rubble? Russian Institutions Have Concerns About Proposed CBDC

The country's central bank has also published a directive limiting the amount of digital assets a non-qualified investor in Russia can buy to no more than 600,000 rubles-worth in one year (about $7,740).

Rules for how Russians must report their crypto holdings for tax purposes are still being finalized.

Mike Tretyak, partner of the Digital Rights Center law firm, which represented Binance in court, said Russia had been blocking crypto-related websites in Russia has been happening since 2015, and resources like peer-to-peer p2p marketplace LocalBitcoins, exchange EXMO, OTC aggregator BestChange and crypto news outlet Bits.Media were blocked at some point.

"In all these cases, there are no victims, claims are filed without any violation of the law per se, since dissemination of information on cryptocurrencies is not prohibited and does not constitute an administrative or criminal offense. Lastly, selection of websites for blocking is completely arbitrary based on “Internet monitoring”, effectively meaning that any crypto website may be blocked at any moment if a local prosecutor so desires," Tretyak told CoinDesk.

However, fighting such decisions in court can be hard as most judges don't understand cryptocurrencies and tend to agree with prosecutors, he added.