Bank of Russia disapproves of cryptocurrencies, apart from Russia’s national one

Maria Nikolova

Bank of Russia’s Governor Elvira Nabiullina says the regulator remains counter any legalization of cryptocurrencies as a legal means of payment, but is, nevertheless, exploring the opportunity to create a national cryptocurrency based on blockchain.

The Bank of Russia has lately been very active in voicing its negative stance with regard to Bitcoin and its likes. The latest comments by Bank of Russia’s Governor Elvira Nabiullina are no exception to this trend.

Ms Nabiullina, quoted by Russian information agency TASS, has noted that Russian central bank sees no point in allowing cryptocurrency trading on Russian exchanges. “We are not supporting legalization of cryptocurrencies as means of payments”, she said.

However, Ms Nabiullina added that the regulator sees the perspectives for blockchain and confirmed that the Central Bank is exploring the opportunity of creating a national cryptocurrency based on blockchain.

Her comments were echoed by those made by Bank of Russia’s Deputy Governor Olga Skorobogatova, who said a national crypto currency would help spur non-cash settlements and electronic payments. Among the problems to be considered is whether and how such a cryptocurrency would be different from electronic money and whether it would replace them. Moreover, the risk of using crypto currencies for money laundering has to be tackled.

The Bank of Russia has previously warned that crypto currencies are money surrogates and their use may be treated as violation of the AML and CFT laws. This stance was first made public early in 2014 and was reiterated in September 2017.

Earlier in October, the Russian financial “Megaregulator” has criticized the cryptocurrency-related activities of the MFB Clearing Center, which had presented a new set of clearing rules on its website, including ones covering clearing of off-exchange electronic contracts for cryptocurrencies. The Bank of Russia demands that MFB removes the rules associated with these contracts and presents the redacted version to the regulator. The recommendations have been sent via mail to the company.

Such contracts, according to the Central Bank, bear high risks. The lack of an adequate risk management system results in a threat to the interests of investors. The Central Bank stresses that cryptocurrencies are not regulated in Russia at present and that the operations involving cryptocurrencies have some of the features of illegal activities such as money laundering and terrorism financing.

The Bank of Russia also emphasized that the internal documentation of the clearing organization does not outline any measures for reducing the technological and other risks, related to virtual currencies.

  • Read this next

    Digital Assets

    Shiba Inu Enhances Privacy & Security with New Encryption

    SHIB, the force behind the Shiba Inu cryptocurrency, today introduced Fully Homomorphic Encryption (FHE) into its platform, ensuring unmatched data protection for its users.

    Digital Assets

    Binance Broadens Its VIP Invitation Program for Traditional Asset Traders

    Step Into the Future of Trading: Binance Invites Traditional Asset Traders to Join Its Exclusive VIP Program

    Digital Assets

    Algotech Presale Revolutionizes DeFi Scene, Surpassing $1 Million Raised in Just Weeks

    Emerging Cryptocurrency trading platform Algotech (ALGT) known to be famous with its cutting-edge features. The TradFi platform features advanced algorithms to provide a competitive edge to traders. 

    Fintech

    Revolut enables direct transfers from Singapore to Bangladesh and Kenya

    British fintech firm Revolut has broadened its array of services with the introduction of the “Mobile Wallets” feature in Singapore, facilitating direct money transfers to Bangladesh and Kenya.

    Digital Assets

    SBF claims “zero loss” to FTX customers, 100-year sentence is “grotesque”

    Sam Bankman-Fried, the former FTX CEO who was found guilty of fraud charges last year, is facing his sentencing next month. But before that day arrives, he’s making a plea for what he considers a fair shake.

    Digital Assets

    Bitcoin nears $62,000, sparking retail buying frenzy

    Bitcoin dashed past the $61,000 barrier on Wednesday, a peak it hadn’t touched since the waning days of November 2021.

    Market News

    OPEC+ Extension of Oil Output Cut Causes Rally

    The dynamics surrounding crude oil are indeed fascinating, given its unique role as both a globally traded commodity and a vital energy source deeply influenced by the OPEC+ alliance’s decisions.

    Institutional FX

    DKK reports 226% growth in 2023 with eyes on African expansion

    “Our numbers are beginning to show how we are powering, the growth required by emerging markets, and we plan for the success of our strategies to continue to thrive in 2024.”

    Industry News

    ‘WTF’ as in ‘What The Fraud?’, Sumsub’s new podcast on digital fraud

    “We found a lack of informative podcasts talking about digital fraud threats and prevention for business owners. So, we decided to dive in and share our expertise along with industry top minds in the ‘What The Fraud?’ podcast.”

    <