The Russian Constitutional Court will rule on whether USDT enjoys property rights or serves as a judicial precedent for stablecoins

The Russian Constitutional Court is currently hearing a key case that will determine whether citizens have property rights over stablecoins such as USDT.

Several regulatory experts have informed the court that fiat-backed stablecoins like USDT do not fall under the category of "digital financial assets" (DFA) according to Russian law, nor do they apply to domestic digital currency circulation rules. The case originated from Moscow resident Dmitry Timchenko, who lent 1,000 USDT in 2023 but was refused repayment by the other party. His appeals to the district court, the higher court, and the Supreme Court were all rejected, with the courts stating that stablecoins do not belong to the protected category of DFA. Timchenko subsequently appealed to the Constitutional Court, claiming that "no other asset class in Russia faces such restrictions." During the hearing, both the central bank and the anti-money laundering agency Rosfinmonitoring stated that stablecoins possess characteristics of "foreign currency digital assets," making it difficult to classify them as DFA, and proving ownership on public chains is challenging. Some legal experts believe that if stablecoins are not recognized as DFA, it could actually benefit ordinary traders in everyday transactions or in evading sanctions, but the lack of legal protection also increases the risk of asset freezing by the issuer. The final ruling in this case is expected to be announced in a few weeks in a non-public manner and is seen as an important precedent for the judicial recognition of stablecoins in Russia.