Russian Central Bank Still Saying “No to Use of Crypto in Settlements”

Richard M.

November 11, 2022

2 minutes read

Russia’s Central Bank has put another wrench in the pro-business Ministry of Finance’s efforts to adopt cryptocurrencies by announcing that it continues to resist the use of coins in settlement scenarios.

Only three days after starting public discussions on various methods to adopt blockchain technology into its financial sector, the Russian Central Bank (CBR) has again shown that their minds have already been made up with regard to cryptocurrencies: “Nyet,”.

“Regarding crypto, we are in favor of the development of digital financial assets, and the digitalization of finance,” CBR Governor Elvira Nabiullina stated. “But digital financial assets are not limited to crypto, to private cryptocurrencies. We have not changed our position that private cryptocurrencies – for which it is not clear who is responsible, or how responsible, which are opaque and carry high risks of volatility – should not be used in settlements.”

In a report, which is meant to serve as the basis for consultations, the CBR distinguished between ‘good’ Digital Financial Assets (DFAs) as well as ‘bad’ cryptocurrencies.

The report is very clear about not taking cryptocurrencies and unsafe stablecoins into account. “The Bank of Russia supports the further development of digital technologies and private innovation projects, including those using distributed ledger technologies,” they write. “At the same time, the use of innovative technologies to create digital assets should not create uncontrollable risks for consumers of financial services, financial stability, cybersecurity, and also lead to violations of [Anti-Money Laundering/Combating the Financing of Terrorism] requirements.”

The CBR has indeed told it plans to launch the online ruble in 2024, and it seems that it’s CBDC will become the only virtual currency that is accepted by the law at that time.