Russia, central bank ready to ban cryptocurrencies https://ift.tt/3JflzaO

The governor of Russia’s central bank Elvira Nabiullina, in an interview with a Russian newspaper two days ago, stated the need to put a brake on cryptocurrency investments, highlighting their volatility and potential use of them to finance criminal activities. 

The Central Bank of Russia plans on cryptocurrencies

According to some recent estimates of the Central Bank itself, at least 15 million Russian citizens invest or own cryptocurrencies. The annual volume of cryptocurrency exchanges would have exceeded, according to the bank, 5 billion dollars. 

According to the Reuters news agency, the central bank would be discussing with the country’s financial authorities to ban, as has already happened in China, activities related to cryptocurrencies or otherwise to put in place tools to limit their circulation in the country.

“The situation in developed market countries more and more resembles the so-called shadow financial system.”

That’s what the first deputy governor of the central bank Ksenia Yudaeva also told Reuters. 

In August, Russia’s Federal Financial Monitoring Service signed an agreement with a technology company to develop new cryptographic tracking tools to combat illicit activities, which are steadily growing in the country through the use of cryptocurrencies.

Russia accelerates on state CBDC

Some point out how this news comes after the Russian Central Bank has reportedly accelerated in recent weeks in its plans to establish a new state digital currency. Just like China, which had launched the first test of its digital yuan before the ban, Russia is reportedly about to launch the first test of digital ruble, and the decision to restrict private cryptocurrencies would be a natural consequence of this.

According to a Central Bank white paper, the first prototype of a digital ruble is expected to launch by early January, directly involving the country’s banks and financial institutions in the project around the middle of next year.

The acceleration on the project of a state CBDC could be determined by the new tensions created with the USA and the EU for the issue of Ukraine, which could lead to new economic sanctions against Russia.

Russia one of the new frontiers of mining

According to other observers, however, the Russian central bank would not intend to limit the activities related to cryptocurrency, such as mining, which in Russia, after the Chinese ban, would have found fertile ground due to its favorable conditions from the energy point of view, thanks to the huge natural resources of gas and oil in the country.

It is not the first time that the country has threatened to ban cryptocurrencies, but it is more likely that in the end, it will approve a serious regulation also in the fiscal field of activities such as trading and mining. A new regulation that would limit the illegal use of cryptocurrencies would provide more transparency and additional revenue for the state. 

In recent days, the head of the parliamentary committee for financial markets, Anatoly Aksakov, has stated that he would already adopt a first reading bill in November precisely on cryptocurrency tax transactions.