Russian Financial Authorities Clash Over How to Regulate Cryptocurrencies

Russian Financial Authorities Clash Over How to Regulate Cryptocurrencies

March 4, 2022 0 By Keith Jacobs

The Russian government seems to be at odds with its stance on the matter of cryptocurrency regulations. For the time being, the threat of a thorough cryptocurrency ban cannot be ruled out. Following in the footsteps of Russian President Vladimir Putin, the Finance Ministry has also expressed the wish to regulate Bitcoin by introducing a regulatory framework.

Meanwhile, the Central Bank of Russia does is not onboard with the idea. Naturally, the use of cryptocurrencies as a mode of payment undermines and undervalues the native currency in the region. Therefore, most Central Banking enterprises are against the progression of cryptocurrencies. The Central Bank spokesperson claimed that due to the high price volatility and the negative environmental impact, digital assets are a bad idea.

After the negative remarks by the Central Bank of Russia, one executive named Ivan Chebeskov came forward from Finance Ministry to support the cryptocurrency sector. He suggested that it is better to create and implement proper cryptocurrency regulations rather than imposing a ban on the nascent industry. According to the reports of the local media outlets, further development has happened on the matter.

Chebeskov recently went ahead and sent his proposal to the deputy chairperson of the Russian Central Bank, Dmitry Chernyshenko. The proposal demands that the state bank make amends to recognize digital currencies as a legal, financial commodity and make provisions for digital investors with regards to their data.

According to the proposal of the Finance Ministry of Russia, choosing to regulate cryptocurrencies rather than imposing a ban can bring a lot of benefits for the government. Some advantages listed in the proposal are an increase in tax collection revenue and the ability to track financial crime activities. The report also claimed that around $25.6 billion worth of investment revenue is already staked in cryptocurrency by the citizens.

Recently, the advisors of the Russian President Vladimir Putin briefed him on the advantages of the cryptocurrencies industry. Putin has called for Central Bank and Finance Ministry officials to work out their differences on the matter and reconcile. Since cryptocurrency investors only require an internet connection for trading cryptocurrencies, a ban from the government will not keep them away from conducting the trade.