Russia’s Central Bank Aims to Ban Cryptocurrency Issuance

Russia’s Central Bank Aims to Ban Cryptocurrency Issuance

Following years of uncertainty about its cryptocurrency law, Russia’s central bank has released another statement on the issue.

For his part, Alexey Guznov, director of legal department at the central bank, said the unfinalized crypto regulations in the nation titled “On Digital Financial Assets” will ban the issuance and circulation of cryptocurrencies.

Although the original bill allows the cryptocurrencies in Russia, it seems that the amended version bans almost everything related to cryptocurrencies except for holding them.

Guznov added the upcoming law would also impose penalties on violating such regulations:

“In terms of the functioning of the financial system and consumer protection system, legalization of the issuance and facilitating the circulation of cryptocurrencies is an unjustified risk. As such, the bill explicitly prohibits emission and organization of cryptocurrency circulation, introducing legal liability for violating these rules.”

The official indicated that the bill would prevent Russian financial institutions from issuing digital assets, but has not offered more clarifications.

Central bank may be unable to regulate BTC transactions

When asked whether the central bank intends to prevent citizens from exchanging cryptocurrencies with the local fiat currency, or foreign currency, Guznov did not offer a clear answer.

Instead, he repeated that the central bank prevents institutions from issuing cryptocurrencies, adding that the bank will not be able to impose limits on Bitcoin transactions:

“If a person who owns, for example, Bitcoins, completes a transaction in a jurisdiction that does not prohibit this, we are unlikely to be able to regulate that.”

Earlier, Cryptolydian reported that the volume of cryptocurrency flows on darknet markets – involving illegal drug and arms trafficking, remittance and transfer of illicit funds – has doubled for the first time in four years.

Thus, Russia has been updating its Anti-Money Laundering laws to help its burgeoning digital economy.

It was reported that the Russian Federal Security Service had been trying to extract a $1 million BTC bribe from a media mogul last spring.

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Rabea Maguid 551 Articles
Rabea Maguid is a journalist completely obsessed with crypto industry. He holds B.A. from Al-Azhar University, and has a background in journalism and economics. Rabea Maguid likes to think about the future in a positive way, and sees blockchain as a potential driver of deep societal change.