Opposing the Bank of Russia’s views on banning cryptocurrencies, the country’s Ministry of Finance is lobbying the government to legalize crypto as financial assets.
Ministry Of Finance Opposes Bank Of Russia
The Ministry of Finance has proposed to only regulate cryptocurrency in the country, claiming that banks could be authorized to provide crypto exchange services. The Russian government is also leaning in favor of legalizing crypto assets instead of banning them. However, the country’s central bank holds a drastically opposite view and wants to ban all cryptocurrencies.
Even though both the Russian Ministry of Finance and the Bank of Russia agree that crypto should not be made a legal tender, they both differ on opinions on whether crypto should be legal assets. The Ministry of Finance has proposed new regulations that would grant certain banks a universal license to trade cryptocurrencies in a strictly controlled environment. Additionally, the proposal also claims that all parties involved in the crypto market would need to be licensed. Crypto investors would be individually recorded under intense KYC processes and anti-money laundering guidelines. Furthermore, crypto transactions are to be taxed and perpetrators would be tried under criminal law.
The Minister of Finance Anton Siluanov has reportedly written to Prime Minister Mikhail Mishustin presenting his case for legalizing cryptos as financial assets. The Ministry is aiming to legalize around $26 billion worth of cryptocurrencies held by the entire population of Russia, claiming that the amount constitutes a sizeable percentage of the entire population’s total savings.
No Support For Bank Of Russia
The Bank of Russia, on the other hand, has taken a complete u-turn from its previous, more crypto-accepting stance. On January 20, the bank published a report detailing the threats to financial stability, monetary sovereignty, and environmental concerns and called for a complete ban on cryptocurrency use and mining within Russian borders. However, back in December, the bank had announced that they intended to regulate the crypto industry rather than ban it outright.
Several other officials and institutions have opposed the central bank’s latest proposal to completely ban cryptocurrencies. Former president and prime minister of Russia, Dmitry Medvedev, has pointed out that a stern anti-crypto policy could backfire and bring about the opposite result. The State Duma has also protested against the proposal to ban cryptos and is actively working on a new crypto law.
The Minister of Digital Development Maxut Shadayev has reportedly said that any restrictions on the issuance and circulation of cryptocurrencies would halt the development of the blockchain industry and create roadblocks in the country’s growing IT sector.
In a virtual speech on January 26, Russian President Vladimir Putin has admitted that the country holds competitive advantages in crypto mining due to its cheap power sources. He stated,
“The Central Bank does not stand in our way of technical progress and is making the necessary efforts to introduce the latest technologies in this area of activity. I would ask both the Government of Russia and the Central Bank to come to some kind of unanimous opinion.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.