How to buy a car for bitcoins in Russia and the world

In 2023, most states accepted the existence of cryptocurrencies and even developed laws to regulate them. In Russia, digital assets are equated with property. They can be bought, sold, given as gifts and bequeathed. However, coins cannot be used as a means of payment. In Europe and the USA, this is easier. But sometimes on the Internet they offer to buy a car for bitcoins in Russia. Such a transaction can be legal.

Russian legislation on cryptocurrency

The Russian government legalized virtual coins at the end of 2020. From the beginning of 2021, Federal Law No. 259 “On Digital Financial Assets” came into force. Cryptocurrencies were equated to property and allowed to use them within the framework of civil law. From this moment, citizens have access to such actions:

• Issuance of coins – provided that the issue is realized on equipment located in the Russian Federation (Chapter 14, paragraph 2 of the Federal Law).
• Purchase, sale and other transactions with virtual assets – only through licensed exchange operators (Chapter 10, paragraph 1 of the Federal Law).

In the next paragraph, the legislator explained the format of operation of such companies. A legal entity (not only a bank) may be an exchange operator of digital assets. The company must obtain a license from the Central Bank of the Russian Federation. Applications are considered by the Department of Admission and Termination of Financial Organizations.

By virtue of Chapter 14 of the law, it is prohibited in the Russian Federation to disseminate information about the offer or acceptance of digital assets as a unit of calculation. However, there are no sanctions for this violation yet.

So can you buy a car with cryptocurrency in Russia? The law does not make it clear. It turns out:

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• The turnover of digital coins in Russia is allowed.
• The organization of the purchase and sale of cryptocurrencies can only be engaged in legal entities that meet a number of requirements.
• For individuals, virtual assets remain one of the most interesting investment instruments (there are no restrictions in this respect).
• It is prohibited to disseminate information about accepting payments in cryptocurrencies.

How to buy a used car for bitcoins

In theory, such a transaction is possible if the seller offers to make a mutual settlement in cryptocurrency. In 2018, such ads were often found on the Internet.

In 2023, it becomes harder to find such offers due to restrictive legislative measures. However, when discussing the features of the car and its price “at the hood”, the buyer can offer the seller to pay part or all of the amount in cryptocurrency. In this case, the fiat unit (USD, RUB or other) will still be specified in the sale and purchase agreement. Also, the buyer will have to take a receipt from the seller that the money has been received in full. Otherwise, it will be difficult to document the transaction.

In 2023, bitcoin in the Russian Federation is a financial and investment instrument. The issue of the asset is limited, and demand is growing every year. Therefore, BTC has every chance to reach the $100 thousand mark and even $1 million per coin in the future.

However, digital gold is still not an official means of payment. Transactions of buying and selling property for BTC between individuals can be easily recognized as illegitimate in court.

Purchase from official dealers

In 2017, representatives of the Ulyanovsk Automobile Plant planned to sell UAZ trucks and SUVs to the farmer cooperative LavkaLavka for bitcoins for 3 years. However, the deal was not realized.

World practice shows: it is possible to buy a car for cryptocurrency. In 2021, Tesla accepted BTC as payment for cars for a month. Later, the company refused settlements in the first cryptocurrency, recognizing its mining as unecological. It is worth noting that in 2023 on the balance sheet of the company remains a significant capital in BTC and DOGE. The stock of coins is estimated at $2 billion. In June 2022, on the website of the manufacturer you can order accessories for Tesla for Dogecoin.

In Western countries, buying goods for cryptocurrency has already become the norm. In Russia, the situation is different. In January 2022, the president instructed the government to come to a consensus on the regulation of digital currencies in the country. As of June 2022, the issue remains open.

At the beginning of the year, the Central Bank of Russia published a report that calls for a ban on the issuance and circulation of digital coins in the country. According to the regulator, it is also important to ban mining and launch a system for monitoring the investments of citizens in virtual assets on foreign specialized platforms.

The national currency in the Russian Federation is the Russian ruble. Mutual settlements between citizens and legal entities are allowed only in RUB. There is no official ban on accepting digital payments. Also, there is no liability for settlements in BTC. Theoretically, it is possible to buy a car for bitcoins in Russia from car dealers. Such transactions are not prohibited by law, but they are not encouraged. Their probability depends on the internal policy of the auto center.

Advantages of buying/selling for BTC

Settlements in digital coins are beneficial to all parties to the transaction. The pros for buyers are as follows:

• Fast and cheap transactions. In June 2022, the commission in the Bitcoin blockchain is 0.000033 BTC ($1.35). All it takes is 2-6 network confirmations for a transfer.
• Accessibility and ease of payments. You can transfer money from any device in one click.
• Reliability. A record of the transaction is stored in the blockchain. It is impossible to delete it.

The main differences between fiat and digital payments are presented in the table.

Peculiarities of settlements	Fiat money	Cryptocurrency
Intermediaries	Bank, payment system	No
Commissions	0.5-3% (depends on amount and bank conditions)	Installed by miners taking into account the current load on the network
Profit tax from the transaction	13%	No
Speed of payment	Up to 5 business days	From a few minutes to a few hours (depending on network congestion)

For merchants, the advantages of digital payments are as follows:

• Acceptance of payment from anywhere in the world without intermediaries.
• Low commission costs.
• Instant access to the funds received.
• Anonymity of payment and protection of personal data.
• No need to pay taxes.

How to buy a car for bitcoins abroad

Western drivers are interested in the offer to pay for a car with digital coins. You can buy a car directly from the seller or through intermediaries (for example, on the Buysellcarwithbitcoin website). Each ad shows the price of the car in USD and BTC. The site has no restrictions for users from Russia and CIS countries.

In June 2022, you cannot buy a car from an authorized dealer in the EU or the US for bitcoins. Such a transaction can be carried out by contacting the seller directly.

Useful tips

At the beginning of 2023, it is possible to buy a car for BTC in Russia privately. Peer-to-peer transactions are not prohibited by law. But there is no official authorization to pay for goods with virtual coins. There are still many gaps in the current crypto-regulation law. As long as they remain, using bitcoins should be done with caution. Here’s what to look out for:

• Legitimacy of the transaction. Amendments to the law can be made and go into effect at any time.
• The current situation in the cryptocurrency industry. If the market capitalization is weakening, it is advisable to sell assets or consider them as a means of settlement.
• Reliability of the payment service. If you need to send a transaction through an intermediary resource, it is worth checking its status.

Before transferring funds, it is necessary to make sure that the recipient’s blockchain corresponds to the type of cryptocurrency (OMNI for BTC, ETH for ERC-20). Otherwise, the coins will be lost. It will not be possible to get them back.

Frequently Asked Questions

❓ Can I buy a car for cryptocurrency in Russia?

Yes. At the beginning of 2023, such transactions are carried out by agreement with the seller. Official dealers do not provide such an opportunity yet.

💳 How to buy a used car for bitcoins?

If there is a counter offer on the market, the deal can take place.

💡 Is buying a car for BTC in the Russian Federation legal?

In 2023, the government and the Central Bank of the Russian Federation do not yet have a consensus on this. Payment for goods with digital currencies is not officially authorized or banned.

🚗 How to sell your car for bitcoins?

In Russia, you need to negotiate with the buyer. In Europe, you can make a deal through an aggregator site (for example, Buysellcarwithbitcoin).

🧐 Do I have to pay tax on the sale of a car for BTC?

As of June 2022, such transactions are outside the legal field in the Russian Federation, but they are not prohibited. Settlement between the parties can be made in crypto coins, but the contract will specify fiat currency. Standard taxation (13%) is applied for such transactions.

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Author: Saifedean Ammous, an expert in cryptocurrency economics.