The Russian central bank had advised the government to take necessary steps to forbid the circulation of cryptocurrencies. The Russian finance ministry however, does not want to resort to such measures. The Finance Minister Anton Siluanov, on 16 February, Wednesday, said that he expects the government to assist in resolving the crypto market regulation conundrum.
It was due to the concerns regarding cryptocurrency
trade and mining, the consequences of which, the bank feared, could be possible financial instability, that the Bank of Russia proposed limiting cryptocurrency trading and mining. The finance ministry, on the contrary, disagreed with the stand of the central bank and President Vladimir Putin urged the officials to reach an agreement with respect to this issue. According to Siluanov, the finance ministry and the central bank have been on the opposite ends of the spectrum when it came to their views regarding cryptocurrency legislation over the past one and a half years. He also added that the government is now supposed to come up with a solution to find a middle ground agreeable for both the parties involved. The finance ministry was expected to suggest ideas to the government on regulation cryptocurrencies, by Sunday, 20 February, the medium which Russians have used in annual transactions worth around $5 billion. Siluanov said, “If we ban cryptocurrencies in Russian, then we need to ban the internet. We don’t use the methods that China uses.” Using the examples of China and India, the Bank of Russia remarked that the country’s regulations need to be tweaked further.
The Russian authorities are currently brainstorming
on enacting comprehensive crypto laws. Other government agencies too, have rejected the proposal by the Bank of Russia to establish a blanket ban on cryptocurrency activities, showing major support with the finance ministry and advocating stringent control over prohibition. The Treasury Department and the Central Bank should have prepared a draft statute to execute the government-approved regulatory strategy by 18 February Russian. Now that the day has already come, there is anticipation as to what they guidelines might be. The lawmakers in the State Duma are likely to pass the new legislation in the spring session of the lower house of the parliament.
Siluanov stated that his ministry believes in the fact
that mining should be legalized and taxed instead of putting bans on the same and that the banks and bourses should be used to identify cryptocurrency market participants. On the contrary, China, in September 2021, imposed a blanket ban on mining and transactions of cryptocurrencies, which caused a decline in value for the major crypto coins and exerted pressure on crypto and blockchain- related equities.
On the contrary, Valeiry Lyakh,
head of the central bank’s department for fighting market misconduct, maintains his stance saying that crypto poses threat to financial service users on Wednesday. As per Fitch Ratings, a ban on cryptocurrencies on one hand, will reduce Russia’s financial system risk exposure, but on the other, will also stifle innovation and impair bank’s technical progress in the long run.