Russia Proposes Complete Ban on Cryptocurrencies

By Adedapo Adesanya

The Russian central bank has proposed a complete ban on cryptocurrencies in the country.

The proposal emphasized that crypto is extremely volatile and has helped to spread fraudulent activities in the country, adding that it is also a potential risk to the country’s national economy.

Director of the Bank of Russia, Ms Elizaveta Danilova, during a presentation, said that a complete ban would mean no mining, trading, or usage of crypto in the country.

However, owning cryptocurrencies would still be legal.

The report also suggested that the government should introduce punishments for individuals who buy or sell products/services using crypto.

The central bank, which is planning to issue its own digital currency, said crypto assets becoming widespread would limit the sovereignty of monetary policy, with higher interest rates needed to contain inflation.

This isn’t the first time the Bank of Russia has gone after cryptos as it had banned mutual funds from investing in any cryptocurrencies.

In 2019, the country blamed cryptocurrencies for spreading money launching and terror financing.

However, the government legalized crypto in 2020, although banning their use as payments.

The move is the latest in a global cryptocurrency crackdown as governments from Asia to the United States worry that privately operated and highly volatile digital currencies could undermine their control of financial and monetary systems.

With the total ban of the asset by China, Russia witnessed a rise in crypto mining and this move has already triggered investors to dump their coins.

In September, China intensified its crackdown on cryptocurrencies with a blanket ban on all crypto transactions and mining, hitting bitcoin and other major coins and pressuring crypto and blockchain-related stocks.

Market analysts note that although the Bank of Russia’s proposal can cause significant worry for its crypto traders and miners, it’s still not confirmed if the government will follow through with a total ban.