Russia declares war on crypto exchanges
Russia declares war on crypto exchanges
Regulation

Russia declares war on crypto exchanges

By Eleonora Spagnolo - 20 Sep 2021

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Russia is reportedly ready to prevent the transfer of money to crypto exchanges. This move would translate as a sort of ban on cryptocurrency trading.

Russia’s “quasi-ban” targeting crypto exchanges

The news was revealed by Bitcoin.com, which cites sources linked to the Central Bank of Russia.

The CBR is reportedly working with commercial banks to prevent the transfer of money to crypto exchanges. The aim is to curb “emotional buying” of cryptocurrencies, especially on unauthorized platforms.

At a meeting entitled “Banks of Russia – XXI Century, Sergey Shvetsov, of the CBR’s board of directors, reiterated that cryptocurrencies are a highly risky asset.

This is why the Russian central bank remains highly sceptical of them.

Sergei Shvetsov

The CBR representative also reportedly stressed the risk that the value of cryptocurrencies could plummet to zero. This could happen for hundreds of reasons. That’s why he stated that the entire sector feels like a minefield.

Russia’s clampdown

Russia seems very concerned about the expansion of the crypto sector. The move anticipated by the CBR follows another clampdown on crypto exchanges.

In recent days, Bitcoin.com has reported that the central bank has instructed commercial banks to identify and block cards and accounts used by suspicious activity. Crypto exchanges are also included in the criteria.

All signs suggest that Russia will do everything in its power to combat the spread of crypto activities, especially if it believes that such businesses are operating without proper licences.

The aim of the monetary authority is to ensure that payments and transactions take place in a single currency: the ruble. 

The consequence of all this is that Russian banks, although aware of the high demand for cryptocurrencies, are currently unable to offer them to their clients.

This is the case with Tinkoff: Russia’s largest online bank has publicly admitted that it is aware that its clients, particularly institutional clients, would be willing to invest in cryptocurrencies, but at the moment the bank cannot meet this demand because the Russian Central Bank has adopted a very tough stance on crypto.

The digital ruble

Russia, however, is not indifferent to technological developments. Elvira Nabiullina, the acting governor of the BCR, said in an exclusive interview with CNBC that digital currencies are the future of Russia and the financial system, referring however to a digital version of the Ruble.

It is no secret that the Russian central bank is working to launch a digital ruble.

This would not be a real cryptocurrency, as it would be highly centralized. It would be issued and controlled by the central bank and a proprietary platform.

It would allow for quick transactions and low costs. But it is a safe bet that it will also become the weapon to curb the rise of Bitcoin and other cryptocurrencies in general.

Eleonora Spagnolo

Journalist passionate about the web and the digital world. She graduated with honours in Multimedia Publishing at the University La Sapienza in Rome and completed a master's degree in Web and Social Media Marketing.

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