Russia Considering Ban on Crypto as Means of Payment
- The Bank of Russia, the country’s central bank, said it will support a ban on crypto as a means of payment.
- Currently, cryptocurrencies are often used to purchase goods and services in the country, as well as a way to pay salaries to some freelancers.
Building of the Bank of Russia. Financial Times
Russia’s central bank is allegedly supporting the idea of banning cryptocurrencies as a means of payment in the country, local news outlet Ria reported on Friday.
According to the report, the Bank of Russia supports the idea of prohibiting the use of cryptocurrencies as a way to pay for goods and services in the country.
The bank further stated that crypto continues to carry significant risks, such as its potential to be used for Money Laundering, financing terrorism and its sharp exchange rate fluctuations.
Russia’s central bank further said that:
“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.”
According to another local news outlet, Izvestia, cryptocurrencies can not only be used for e-commerce in Russia, but some freelancers agree to accept their salaries in either Bitcoin (BTC) or Ethereum (ETH).
Vladislav Antonov, an analyst at Alpari Information and Analytical Center, told the news outlet that while the use of cryptocurrencies as a means of payment is neither prohibited or allowed, they are often used to purchase goods and services, such as tickets, computers and household appliances, renting an apartment, or booking a hotel.
Currently, the legal status of smart contracts, cryptocurrencies, ICO’s and mining in the country remain uncertain. Last month, the Russian Ministry of Internal Affairs, and other law enforcement agencies, began formulating proposals to allow the confiscation of cryptocurrencies in the country.
These proposals could materialize into Russian laws by 2021.
Even though a number of central banks around the world are looking into the possibility of issuing their own Central Bank Digital Currency (CBDC), the Bank of Russia seems to be going in a different way.
Earlier this year, Russian news agency TASS reported that the bank saw no reason to issue a CBDC, with the chairwoman of the central bank, Elvira Nabiullina, saying:
“As Russia’s Central Bank, we have been studying this topic and the need to issue a national cryptocurrency is not obvious for us. Not only for technological reasons, but also because it is (difficult) to really estimate what advantages will the national digital currency give, for example, in comparison with existing electronic non-cash payments. There are many risks, and the advantages may not be obvious enough.”
- The popular crypto exchange has decided to sell its business in Russia to CommEX, a crypto exchange business that was officially launched on Tuesday.
- Binance noted that it will fully exit the Russian market, and have no ongoing revenue split or any option to buy back shares in the business.
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- Planned for 1 April, the CBDC trial will involve real consumers and real transactions, though they will be limited to a certain number of customers and transfers.
- The pilot, however, will not be opened to the general public in its first phase, and will only be opened to customers chosen by the 13 participating local banks.
- Nigeria’s Investments and Securities Act 2007 (Amendment) Bill is looking to recognize the usage of Bitcoin and crypto in the country.
- The bill was proposed almost two years after the Central Bank of Nigeria abandoned its plans to regulate digital assets, and banned institutions from facilitating crypto transactions.