Russia’s central bank is ready to ban cryptocurrency payments

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If the Russian parliament were to introduce legislation banning the use of cryptocurrency, the country’s central bank wouldn’t object. This, despite a statement about six months ago from the bank in which it said that it wouldn’t mind offering a state-backed digital currency. The Central Bank of the Russian Federation has released a statement showing support of a potential ban, provided legislation were put in place, asserting that crypto still carries too much financial risk.

According to Russian media outlet RIA Novosti, the central bank is ready to clamp down on crypto transactions as soon as the word is given. The bank told the news outlet, “The only legal tender in the Russian Federation is the ruble. We continue to believe that cryptocurrencies carry significant risks, including in the field of laundering of proceeds from crime and the financing of terrorism, as well as during exchange transactions due to sharp exchange rate fluctuations.”

There has been a lot of debate about crypto in Russia. Previously, it was expected that the country might actually get behind digital currencies, but that belief has since dropped off. As with other countries, government leaders can’t seem to reach a consensus about how to view crypto while, at the same time, considering introducing their own digital currency.

The central bank added, “In our opinion, private cryptocurrencies cannot be equated with fiat money and cannot be legal tender. If it is decided to ban cryptocurrencies as a means of payment at the legislative level, we consider it appropriate to support this position.”

Elvira Nabiullina, the chair of the bank, doesn’t even believe that a central bank-issued digital currency would be viable. However, this position has been countered by others in the country’s government that feel that crypto might be a good way for Russia to overcome sanctions imposed on it by countries like the U.S. She showed this past October a certain lack of understanding on crypto, stating, “There is a worldly wisdom that free cheese is only in a mousetrap: easily earned money quickly leaves.” Given that Bitcoin was never designed to be a money-making tool, her argument is moot.

For more than two years, Russia has struggled to put together policies for digital currencies, despite demands by President Vladimir Putin for the legal framework to be implemented. Despite the continued rhetoric that crypto is only good for illicit activity and that price fluctuations make it irrelevant, the country reportedly doesn’t mind investing in crypto when it needs to.