Russian Court Recognizes Cryptocurrency as Means of Payment, Prosecutors See Precedent – Bitcoin News

The St. Petersburg City Court has recognized a large amount of cryptocurrency handed over by the victim in an extortion case as a means of payment, Russian media reported. The prosecutor’s office in Russia’s second-largest city describes the ruling as a precedent.

Two men sentenced for extortion with cryptocurrencies in Russia

Two Russian citizens have been sentenced to nine and seven years in strict prison for extorting 5 million rubles (nearly $90,000) in cash and 55 million rubles (nearly $1 million) in digital assets from another man.

In the course of the trial, the St. Petersburg City Court recognized cryptocurrency as a means of payment, Russian business news portal RBC’s cryptocurrency page reported. Prosecutors see the ruling as a first, as the Moscow government has yet to determine the legal status of bitcoin and the like.

Four years ago, one of the perpetrators, Pyotr Piron, introduced himself to the victim, GA Shemet, as an officer of the Federal Security Service (FSB). He threatened Shemet with criminal prosecution to extort him in the form of fiat currency and cryptocurrency, the article details.

Since Shemet did not believe that Piron was a security officer and refused to give him the funds, the latter hired the services of an accomplice, Yevgeny Prigozhin, a former employee of the Russian Ministry of Internal Affairs (MVD).

The two told Shemet that a criminal investigation will be launched against him for alleged illegal circulation of cryptocurrencies. In the summer of 2018, they staged a fake arrest of the cryptocurrency owner who, under threat of torture, handed over the fiat money and his cryptocurrency stash.

The city court’s initial decision did not take into account the misappropriated crypto. He stated in the verdict that cryptocurrency “is not a means of payment on the territory of the Russian Federation, therefore it cannot be recognized as an object of civil rights and the subject of a crime.”

Upon appeal, a court of cassation declared that cryptocurrency can nonetheless be considered a means of payment and sent the case back to the court of first instance. Without changing the prison sentences of the defendants, the city court issued a new verdict, adding the digital money.

The development comes after a St. Petersburg district court last month allowed law enforcement officials to seize cryptocurrency stolen in another criminal case. Investigators demanded the seizure of two dozen crypto wallets from a suspect, holding one billion rubles worth of ethereum (ETH).

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Arrest, Case, city court, Court, Crypto, Cryptocurrencies, Cryptocurrency, Decision, Extortion, legal status, means of payment, precedent, Regulation, Regulation, ruling, Russia, Russian, Seizure, saint petersburg, verdict

Do you expect to see more crypto-related cases in Russian courts? Tell us in the comments section below.

Lubomir Tassev

Lubomir Tassev is a tech-savvy Eastern European journalist who likes Hitchens’s quote: “Being a writer is who I am, rather than what I do.” In addition to crypto, blockchain, and fintech, international politics and economics are two other sources of inspiration.

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