The bank refers to the announcement as a recommendation rather than a regulation. Exchanges should refrain from including such assets in mutual funds, among other financial services.
The Central Bank of Russia (CBR) uses the alleged risks of cryptocurrencies as an argument to recommend local exchanges to avoid trading them.
The statement appearing on the website of the Central Bank of Russia specifies that it is a recommendation. However, the article cites a document mentioning the obligation to reject instruments based on digital assets or whose prices depend on them.
That regulation covers much of the spectrum of cryptocurrencies, such as direct trading with them or through derivative financial assets. The latter include indexes based on crypto assets.
The announcement also states that the recommendation aims at securities markets, management companies, investment funds, mutual funds, and non-state pension funds. Likewise, it goes to professional participants and business organizers.
Additionally, the statement indicates that the recommendation only contemplates the field of cryptocurrencies. It does not consider the digital assets that the Central Bank of Russia could issue in the future. This information seems to serve to clarify the situation before the launch of the digital ruble.
Olga Skorobogatova, the First Vice President of the Central Bank of Russia, explained the reason for issuing the digital ruble. She said that this project seeks to increase accessibility and reduce payment and transfer costs for citizens and companies. The executive added that there needs to be a seamless transition from one form of the ruble to another to make it easier to use.
Central Banks Are Willing To Regulate and Even Ban Bitcoin
The Central Bank of Russia is not the first bank that has maintained a position to regulate and even prohibit using cryptocurrencies. They have even contemplated legalizing the confiscation of Bitcoin and altcoins. They do not seek to protect users but rather to pave the way for central bank digital cryptocurrencies (CBDC).
Igor Krasnov, the Attorney General of the Russian Federation, believes that the trading of cryptocurrencies contributes to laundering stolen money. He said that the law became progress against the problem. However, he thinks that the new amendments to the Penal Code would provide additional protection.
For its part, China is struggling to launch its digital yuan in a scenario where there is no competition. For that reason, it has banned Bitcoin mining in different provinces and has prohibited cryptocurrency trading platforms such as Binance.
The European Union has also started to set its position with its recent bill. In a regulatory environment, they will try to identify all Bitcoin transactions that users make.
Concerning the digital ruble, Russia has already selected twelve banks to conduct its first tests. Besides, they hope to have a prototype of this financial instrument by the end of this year. The institutions that applied and received approval are Ak Bars, Alfa Bank, Bank DOM.RF, VTB Bank, Gazprombank, Tinkoff Bank, Promsvyazbank, Rosbank, Sberbank, SKB-Bank, SOYS Bank, and TKB Bank.
By Alexander Salazar
