Russia’s central bank said Thursday that cryptocurrencies ought to be banned.
The Russian central bank has called for cryptocurrency to be banned in the country, citing crypto as a threat to the country’s financial stability. The move overlaps with Russian citizens’ increasing use of cryptocurrencies.
Elizaveta Danilova, the Bank of Russia’s Financial Stability Department director, spoke at an online press conference with the report, “Cryptocurrencies: trends, risks, measures.”
The report indicates that cryptocurrencies are volatile and often used for theft. This risks undermining the national economy and complicating the regulator’s job to maintain optimal monetary policies.
The bank believes that the country needs new laws and regulations prohibiting cryptocurrency-related businesses. In particular, cryptocurrency issuance, and the organization of cryptocurrency circulation in Russia, needs to be banned. This includes exchanges, OTC trading desks, and peer-to-peer platforms.
The research suggests that the existing ban on the use of cryptocurrency for payments needs to be tightened and that individuals and businesses who use cryptocurrency for payment should be penalized.
In order to prevent Russian institutional investors from making cryptocurrency investments, no Russian financial institutions or equipment should be used in bitcoin transactions. A ban on Russian mutual funds investing in cryptocurrencies has already been put in place by the Bank of Russia. It is now proposing the introduction of a penalty for those who violate the ban.
Moreover, the central bank plans to monitor cryptocurrency transactions carried out by Russian citizens. It will also collaborate with countries where cryptocurrency exchanges are registered in order to acquire information about transactions by Russian citizens.
Regarding the investment attraction of crypto assets, the Bank of Russia stated that they could be replaced by digital assets created in Russia under the country’s digital asset law, which took effect in summer 2020.