Russia's Decision on Stablecoins May Transform Digital Asset Legislation

Russia's Constitutional Court is preparing to issue a pivotal decision that may reshape how stablecoins such as Tether's

are classified under Russian law, potentially determining if they are considered property. This case, which stems from a 2023 lawsuit involving a $1,000 USDT loan, has attracted the scrutiny of senior regulators, including Central Bank Deputy Chairman Alexey Guznov and representatives from the Ministry of Finance, of the current digital financial assets regulations.

The dispute centers on Dmitry Timchenko, a Moscow resident who took legal action against a borrower accused of defaulting on a loan.

, stating that Russia's DFA regulations, which came into effect in 2021, do not cover stablecoins like USDT that are tied to fiat currencies and issued abroad. Timchenko's attorneys contend that this interpretation violates the constitution, on a type of property not subject to such restrictions in other asset categories.

The court's discussions have revealed significant disagreements among specialists.

, highlighting the difficulties in verifying ownership on open blockchains. At the same time, that self-reporting, rather than blockchain analytics, is still the most dependable way to confirm who owns stablecoins. Andrei Klishas, a Federation Council member, also remarked that USDT acts more like "foreign digital property" than a digital currency.

This uncertainty stands in contrast to recent changes in Russian law, where legislators have started to recognize cryptocurrencies as property in criminal proceedings.

, now in its final reading in parliament, gives authorities the power to seize and take possession of crypto assets during investigations. The statute, which is consistent with current court practices, confiscated crypto into secure wallets and working with overseas exchanges. have argued these legal updates are overdue, pointing out that courts have already acknowledged digital assets as property in civil cases.

The implications reach far beyond Russia.

to $303 billion in 2025, and US Treasury Secretary Scott Bessent anticipates it could grow tenfold to $3 trillion by 2030. that if stablecoins are excluded from DFA protections, it might encourage their use for daily payments or to bypass sanctions, while also leaving users vulnerable to risks such as abrupt freezes by issuers.

The Constitutional Court is anticipated to announce its verdict in a closed session before the end of the year.

, it may prompt a revision of Russia's DFA laws to include stablecoins. On the other hand, if the lower courts' decision is upheld, it would likely reinforce the separation between Russian-issued DFAs and foreign-backed tokens like USDT.