In Russia, the Central Bank wants to ban cryptocurrencies from the country, in order to “reduce the threats caused by their spread.” The Russian secret service is said to be the main carrier of this ban. By March 1, the Central Bank has promised to provide further details for possible new laws.
Headwinds for cryptocurrency enthusiasts, in Russia. The country’s Central Bank has issued a report proposing a ban on “mining” and cryptocurrency investments and payments. “In order to reduce the threats caused by the spread of crypto-currencies,” the Bank of Russia is proposing to amend legislation banning all crypto-currency-related activity in the country, calling for similar measures to be taken in the countries of the Eurasian Economic Union, which brings together many former Soviet bloc countries. The institution cites the volatility of these “currencies” and their illegal uses.
Their use would threaten “the well-being of Russian citizens, the stability of the financial system,” the report said, claiming that the growth of the sector in recent years was based on speculation. The Central Bank cites a September 2020 study that Russia ranks 2nd out of 154 countries in the use of cryptocurrencies, just after Ukraine and before Venezuela. “The volume of cryptocurrency transactions in Russia in 2019-2020, relative to the population and the size of the economy, was very high,” the Bank notes, estimating it at $5 billion.
Crypto-currencies gained legal status in 2020, and Parliament and some ministries have spoken out in favor of legalizing and regulating “mining,” an essential step in building the blockchain on which a crypto-currency is based. The Central Bank has long spoken negatively about cryptocurrencies, highlighting their possible use for fraud or to fund terrorist activities.
According to Bloomberg, citing anonymous sources, the Russian secret services would be the main bearers of this ban, as cryptocurrency payments are a popular tool to fund the opposition or “undesirable” organizations, a status that Russia is constantly expanding to various civil society actors.
By March 1, the Central Bank has promised to provide additional details for possible new legislation.
