Russia Just Suggested A Blanket Ban On Bitcoin And Cryptocurrency
January 20 2022 - 4:30PM
NEWSBTC
Russia has proposed a full ban on crypto, this includes both mining
and use of cryptocurrencies. The country’s Central Bank suggested
that the trading of cryptocurrencies must come to a stop
immediately. In the report put forth in an online press conference,
the Russian government along with the Bank of Russia suggested this
regulatory measure. This blanket ban on cryptocurrency was tied to
risks of financial instability and rising illegal activities. The
digital asset apparently posed a serious threat to the sovereignty
of Russia’s monetary policy. Russia holds the third rank in bitcoin
mining after US and Kazakhstan. This recent ban on cryptocurrency
comes right after the Central Bank of Russia displayed interest in
securing information from commercial banks in respect to private
money transfers. It also specified that the information collected
will comprise of details of individuals who have previously traded
in cryptocurrency, not only within the country but also outside of
it. Despite Russia legalising cryptocurrencies in the year 2020, it
always remained sceptical in regards to accepting the same as a
medium of exchange. The report stated that this measure of banning
crypto might after all be in favour of Russial as this decision
happens to be the “best” and “optimal” one that safeguards Russia.
“Cryptocurrencies: Trends, Risks, Measures” In the report,
“Cryptocurrencies: trends, risks, measures” an excerpt read that
cryptocurrenices “offer an outlet for people to take their money
out of the national economy, thereby undermining it and making the
regulators job of maintaining optimal monetary policies harder.”
The other major concern that led to this ban was the ever
increasing dynamic and volatile nature of cryptocurrency along with
illegal activities being funded by the digital asset. The
culmination of which has urged the Central Bank to form new laws
and regulation which could help ban the digital asset in Russia.
Related Reading | NGOs Use Crypto To Aid Afghans Facing Taliban
Takeover Russia previously also expressed its concerns around
cryptocurrency as they believed that the asset could be used for
money laundering and even financing terrorism. Reportedly, Russia
has showed interest in creating thier own digital currency (CBDC)
which is believed to enable, equip and finally empower the
functioning of future banking in the country. This could help
people of Russia to opt for a quicker, easier and more seamless
payment option. The report also stated that there will be a
prohibition of mutual funds investments in cryptocurrency. Besides
that, institutional investors have also been discouraged from
investing in crypto. This move might be quite a blow to the
country’s financial organisations as any cryptocurrency in the form
of a financial asset will not be accounted for. Failing to abide by
the above mandated resolution will result in firm punishment as
mentioned in report. The crypto industry's growth has attracted a
lot of negative attention | Source: TOTAL-CRYPTOCAP on
TradingView.com Russia Crypto Ban Extends To Mining Also
Cryptocurrency mining in Russia has a major footing as the country
is the third largest when it comes to mining of cryptocurrencies.
Volume of cryptocurrency mining still remains the highest in the
US, followed by Kazakhstan, however, the latter has been in talks
about cutting off electricity provisions. This news about Russia’s
ban might potentially drive crypto enthusiasts across the globe up
the wall. Minimising of crypto issuance along with over-the-counter
trading desks, crypto exchanges and peer-to-peer exchanges could
send a ripple across the whole crypto space. Related Reading |
Digging Into The Data Of Bitcoin Mining Decentralization The
aforementioned report also added that this prohibition was also
because of environmental factors as it creates “”creates a
non-productive electricity expenditure, which undermines the energy
supply of residential buildings, social infrastructure and
industrial objects, as well as the environmental agenda of the
Russian Federation. Featured image from iStockPhoto, Charts from
TradingView.com
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