The Russian Central Bank has rejected a plan to enable the digital currency to circumvent sanctions. This, according to the monetary authority, is unlikely to happen since Western regulators are already making efforts to prohibit such transactions.
The Bank of Russia believes that using cryptocurrency to get over financial limitations imposed due to the military crisis in Ukraine is impossible. According to a statement published by the central bank’s First Deputy Governor, Ksenia Yudaeva, in response to a proposal by a member of the Russian parliament’s lower chamber, the State Duma, they made it clear.
Russian enterprises and private entrepreneurs should be permitted to make payments in digital currencies, including settlements with overseas partners, according to Anton Gorelkin, a legislator from the ruling United Russia party. He believes that constructing a Russian national crypto infrastructure in reaction to Western sanctions is unavoidable.
On the other hand, officials from the central bank are persuaded that large-scale cryptocurrency transfers by Russian enterprises are impossible. According to the Russian news agency RIA Novosti, Yudaeva stated that regulatory agencies in the EU, the United States, the United Kingdom, Japan, and Singapore have begun to adopt precautionary steps.
She went on to say that digital asset companies, such as cryptocurrency exchanges, are enacting limitations that effectively deny Russian users access to their cash. Even in places where crypto payments are not yet prohibited, authorities are imposing more stringent client identification requirements on crypto service providers.
The Russian Central Bank (CBR) is a staunch opponent of cryptocurrency legalisation. The banking regulator suggested a total ban on crypto-related activity in the country in January. It claims that decentralised digital currencies such as bitcoin can’t be utilised to pay for goods or services.
The CBR has been isolated among Moscow’s government institutions due to its strong position on the issue. In February, the federal government approved a regulatory plan based on the Finance Ministry’s concept, favouring regulation under strict oversight over prohibition.
The ministry presented a new bill, “On Digital Currency”, days before the Russian army breached the Ukrainian border, completely regulating the country’s crypto sector. In mid-March, Alexander Yakubovsky, a Russian senator working on impending crypto laws, indicated that cryptocurrency might help Russia regain access to global banking.
