The Ministry of Finance has published amendments aimed at attracting investment funds to Belarus for public comment. Despite having a regulatory framework in place for collective investments, the department stated in its motivations for the initiative that not a single fund has been registered in the country so far.

According to professional circles, one of the main reasons for the lack of such funds is that they are currently barred from investing in crypto assets. The market for “digital signs (tokens),” the legal term for cryptocurrencies, is expanding rapidly, according to the finance ministry.

The ministry has proposed an amendment to its own decree on securities market activities involving investment funds.

To remove the restrictions, the ministry has drafted a resolution amending its own decree on securities market activities involving investment funds. It intends to allow the funds to operate as securities dealers as well as residents of the Belarus High-Tech Park at the same time (HTP). The latter is in charge of a special legal regime set up to facilitate the country’s digital economy, which includes the crypto sector.

Another source of concern among professionals is the government’s failure to provide long-term guarantees regarding existing tax breaks for the industry. To address the issue, the Ministry of Finance has proposed new legislation that will extend tax exemptions for entities engaged in collective investment until January 1, 2031.

Belarus opened its doors to cryptocurrency businesses in the spring of 2018 with a decree “On the Development of the Digital Economy.” The document, which was signed by President Alexander Lukashenko, included tax breaks and other benefits for businesses dealing with digital assets.

Despite Lukashenko’s hinting at tightening regulations in March, Belarusian officials have recently indicated that the authorities in Minsk have no intention of adopting stricter rules for the crypto space, even as the country’s closest ally, Russia, is debating a proposal to ban a variety of crypto-related activities.

While the use of cryptocurrency as a means of payment is illegal in Belarus, HTP residents can create and exchange coins and tokens. Belarus is ranked third in Eastern Europe by Chainalysis’ crypto adoption index, after Russia and Ukraine, due to strong peer-to-peer activity.