Russian Central Bank & Government Fail to Agree on Crypto Regulation; New Limits Proposed

 

Senior officials from the Russian government and the Bank of Russia, the country’s crypto-skeptic central bank, did not manage to reach an understanding on the means to regulate the Russian cryptoasset market — while the Deputy Finance Minister now proposes a buying limit for “unqualified investors” of USD 665. 

Elvira Nabiullina, Governor of the Bank of Russia, Deputy Prime Minister Dmitry Grigorenko, and Finance Minister Anton Siluanov failed to reach an agreement on potential crypto regulations, sources close to the talks told Bloomberg. This indicates a growing row over crypto between the central bank and more crypto-apologetic government officials.

The failed attempt came on Tuesday despite direct orders from Russian President Vladimir Putin who reportedly told the officials to develop a compromise on the matter.

Nabiullina, who served as an aide to Russia’s authoritarian leader in the years 2012 to 2013 before taking over the helm of the bank, has championed a ban on crypto in a bid to curb what she perceives as a threat to the Russian financial system. The governor voiced her concerns in a letter she addressed to Siluanov and obtained by reporters. The Bank of Russia’s press service confirmed the letter’s contents. 

Speaking at a conference organized by Russian financial paper Kommersant, Deputy Finance Minister Alexey Moiseev argued that cryptoassets are “a highly speculative and very risky product,” and proposed to limit the maximum purchase value for “unqualified investors” to RUB 50,000 (USD 665).

Moiseev was quoted by local news agency Interfax as stating that:

Regarding “[d]igital currency, we fully agree with the central bank in its assessment of all its characteristics and risks associated” but “the only question is what to do next with it, what are the conclusions to take from this. This is the only disagreement that we have left with the central bank.”

Russia’s Ministry of Economic Development is proposing to enable crypto mining in regions that benefit from a steady supply of electricity and tax conversion of crypto into rubles, but the central bank maintains its vehement opposition to crypto, per a report in local paper Izvestia.

Meanwhile, the Bank of Russia has moved its central bank digital currency (CBDC) project into a testing phase in cooperation with three unnamed local banks. Olga Skorobogatova, First Deputy Governor of the central bank, told Interfax that the bank will test different scenarios for the digital ruble throughout 2022.

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