Central Bank of Russia has reiterated its opposition against cryptocurrency investments, citing the volatility of these digital assets as its main motivator. Recent statements by Governor Elvira Nubullina have indicated that there are ways to regulate them.
Nabiullina argues that the Bank of Russia can limit investments in crypto assets
Russia’s monetary authority does not welcome investments of Russian citizens in cryptocurrencies, the head of the Central Bank of Russia (CBR), Elvira Nabiullina, said during an online press conference this week. She highlighted their volatility and potential use in criminal activity as major reasons for the regulator’s position.
The governor also noted Bank of Russia’s stance that the Russian financial infrastructure should not be employed to facilitate cryptocurrency transactions. She stressed that the regulator is capable of implementing restrictions and reiterated the bank’s skepticism towards these assets. RBC business news site quotes the Russian central banking chair as saying:
Retail investors are at great risk from cryptocurrencies due to their volatility and illegal use. We cannot accept investments in these assets.
Nabiullina’s statements come after media reports revealed that Russian authorities are now holding discussions to choose between two very different approaches to the regulation of cryptocurrencies and related activities. While the Bank of Russia seeks to block crypto-purchases, the State Duma has begun developing rules for cryptocurrency mining and exchange. These will legalize cryptocurrencies despite the CBR’s opposition to their free circulation including their use in payments.
Reuters quoted sources who were close to CBR, saying that they are currently in negotiations with market players about a potential ban on Russian investors acquiring crypto assets in the future. One of them unveiled that the central bank’s current position is one of “complete rejection” of cryptocurrencies. Experts in the industry warn that this move could push cryptocurrency investors underground, and stop tax collection by the state.
Anatoly Ashakov, head of the Financial Market Committee in Parliament, said that lawmakers were also looking into legalizing cryptocurrency trading to allow taxation of incomes and profit. Aksakov pointed out that the State Duma already passed a draft bill to tax crypto transactions within the Russian Federation on its first reading. This legislation recognizes bitcoin and digital currencies as property to tax purposes.
Are you positive that Bank of Russia would convince the other authorities in support of a ban against cryptocurrency investment? We’d love to hear from you in the comment section.
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