Central Bank of Russia to take hardline stance on cryptocurrency; Why?

Central Bank of Russia to take hardline stance on cryptocurrency; Why?
Central Bank of Russia to take hardline stance on cryptocurrency; Why?

With websites like Cointelegraph, Bitcoin Magazine, CryptoSlate, and Cryptoknowmics, it has become easier for crypto enthusiasts to stay abreast with the upcoming crypto events. These websites are the best source to explore for ongoing cryptocurrency events and developments that are taking place in the crypto world. According to the latest crypto news, the Central Bank of Russia will go to take a tougher stance on the spread of cryptocurrencies. As per this newly published report, the government will be taking the step of regulating the Russian crypto space. 


Why Central Bank of Russia is getting strict on cryptocurrency?


Pointing to the annual report of 2021, the Central Bank of Russia (CBR) stated the high risks involved with crypto operations that are creating systematic threats after witnessing the growing interest of Russian people in cryptocurrencies and investment in them. 


By mentioning the cases of cryptocurrencies like the dominant crypto Bitcoin, the monetary authority made a statement indicating the risk of eroding the money circulation and dipping sovereignty for the Ruble, the national currency of Russia. The financial regulator also mentioned the previous warnings about how cryptocurrencies are spreading the risk of discharging funds from the conventional monetary structure towards the existing big crypto market that is not regulated.


The CBR also quoted that this moving of savings is a threatening sign for the financial stability of banks in Russia. It has also shown concern for the citizens well being, as in its opinion, the rising graph of the crypto market is forming a bubble, and digital currencies carry the gestures of monetary pyramids. 


Investor safety lies to a certain limit, and those showing interest in investment in cryptocurrencies are at risk of losing their money because crypto is vulnerable to price volatility. Besides this, there is also a possibility of cyber threats and crypto frauds, adds the apex bank of Russia. 


The report came after the ban on crypto activities has been suggested by the CBR in January. The hardline stance on cryptocurrencies did not get ample support, but opposition from other government organizations. In the following month (February) the Central Bank of Russia came up with legislation to forbid crypto practices. 


Will CBR get success in its mission?


However, there are no possible chances of getting ample support because there has been a rise in the number of officials in Moscow who are looking for the chances to engage crypto assets in avoiding the western penalty foisted over the invasion of Ukraine by Russia.


Submission of ‘On Digital Currency bill’


The Ministry of Finance is showing a positive approach with its efforts in giving cryptocurrency operations a legal status, with the payments in BTC as an exception. Recently, it has once again submitted the new cryptocurrency bill name ‘On Digital Currency to the federal government that supports its proposal. 


In this current draft law, there are now provisions for crypto mining regulation. The Central Bank of Russia has also shown signs of legal acceptance of this new decentralized money industry. Going by some estimates, the CBR has also further noted about the volume of crypto transactions by Russians reaching around $5 billion in 2021. 


There has been actively trading on cryptocurrency exchanges by people in Russia. The country has also reached the rank among the world leaders having the capacity of minting crypto coins. This has been acknowledged by the regulator. 


Know some brief facts about the Central Bank of Russia (CBR)


  • The Central Bank of the Russian Federation also called as Bank of Russia is a central bank in the Russian Federation.


  • The Russian bank laid its foundation in 1860 as the State Bank of the Russian Empire. 


  • The idea of having a State Bank of the Russian Empire came into the mind of Emperor Peter III in 1762. 


  • It was shaped accordingly to the Bank of England, and the right to issue banknotes.


  • The headquarter of CBR is in Moscow on Neglinnaya Street.


  • Its operations are described in federal law and also in the Constitution of Russia (Article 75). 


  • During 1917, CBR constituted 133 offices (permanent) and 5 temporary ones. Besides this, it also had forty-two agencies and eleven branches. 


  • In 1990, the Central Bank of Russia got established on July 13 after the changing of the Russian Republican Bank of the State Bank of the USSR. 


  • In the same year on December 2nd, the law on the Bank of Russia (CBR) was passed by the Supreme Soviet of the RSFSR. Bank of Russia was given legal status. 


Final words


So despite attempts of the Central Bank of Russia on taking a hardline stance on cryptocurrency, there are no possible chances of its success. And it is because of the active initiative of Russians towards crypto activities including investment and other dealings. As has been mentioned above, the volume of crypto transactions by Russians reaching around $5 billion in 2021. 


Check out for more crypto upcoming events on the leading cryptocurrency website, Cryptoknowmics. It is the best crypto guide that features all that is related to the crypto world. Here you can keep track of the price movements of digital currencies including Bitcoin and altcoins.