Russian Finance Ministry to Consider Central Bank Proposals on Cryptocurrencies

There are various factors that affect the price of cryptocurrencies. When there is positive news about it, more people start adopting it. When the adoption rate increases, the price of the crypto increases. There are many countries that are trying to ban cryptocurrencies while some of them are trying to legalize them. But recently in Russia, both things happened in a very short span. The cryptocurrency exchange platforms like https://yuan-paygroup.com/ will need a license from the Russian government.

The Central Bank of Russia proposed that cryptocurrency should be banned in the country as it is a risk to the digital market. But in just no time, even Russian Finance Minister Anton Siluanov submitted a draft about cryptocurrency regulations. Just two days ago, the Russian Finance Ministry is showing interest in the proposal sent by the central bank. They may consider it. So, if you are not aware of these two proposals, then here is some light on what the central bank said and what is the finance minister’s draft about.

Central Bank’s View

Russian banks are suggesting some tough rules on cryptocurrencies. Cryptocurrency can be a major threat to digital currency. Mining can also pose some risks to the economy. After this proposal was made, the price of many cryptocurrencies came down, especially Bitcoin. The bank says that there can be many threats due to cryptocurrencies like digital hacking and money laundering. It is discussing with some of the experts and the market players regarding the complete ban of cryptocurrency in Russia.

Russian Finance Minister’s View

The views of the Russian Finance Minister are different from this. Mr. Anton Siluanov has mentioned in his draft about the cryptocurrency regulations. Cryptocurrency is a booming industry at present, but it is not regulated in most countries. He says that the ban on cryptocurrency for goods and service payments will be upheld. But they also going to set a cap on the amount that can be invested in cryptocurrencies. It also contains some information about what is crypto mining and how it can be done.

Cryptocurrency in Russia

Russia is one of those countries that have a lot of crypto investments and trading. If you check its market value, then it is somewhere around $200 billion at the beginning of February 2022. 12 percent of what the whole world holds. Every year, almost $5 billion transactions happen with cryptocurrency. The population of the country is 144 million and they own $26.5 billion cryptos. 12 million crypto account holders are present in Russia. This is not a small number.

When compared to all the countries, Russia is having the world’s 3rd largest mining industry for cryptocurrency. The first two are the United States of America and Kazakhstan.

Central Bank’s Proposal

The Russian government has announced that it may consider the proposal sent by the central bank. But they also mentioned that it should be contradicting their own method, which paves the way to the digital asset being governed legislation.

The proposal sent by the finance minister has heated up the discussion about a complete ban on cryptocurrencies. The finance minister wants to make cryptocurrency has a tool where people will be able to invest and make some profits. But it cannot be used as a tool for payments.

The points discussed as part of the proposal were:

Any transaction that involves the sale or purchase of cryptocurrency will need verification. Customer verification is important to avoid the anonymity of the transactions. That will be a way to avoid any sort of problems like fraud or money laundering.

There will also be a literacy test that will decide how much an individual is eligible to invest. Those who pass this test can invest up to 6,00,000 roubles per year. But those who fail the test will only be able to invest 50,000 roubles per year.

The bank also says that there will be heavy energy consumption in the mining process and hence it can be risky to the environment.

The final decision is yet to be made by the government of Russia and we will have to wait for it to see what changes they are going to make. They will take care of everything that can reduce the risk of the investors in cryptocurrency.