Russia sees crypto as ‘necessary evil’
Russia’s Finance Ministry has warned about the dangers of investing in cryptocurrencies, although it acknowledged that digital assets could be useful in certain situations.
Deputy Finance Minister Aleksey Moiseev described cryptocurrencies as “an evil,” adding that the Bank of Russia shares a similar view.
“Crypto as a whole, of course, is an evil, and I believe that people who invest their savings in it are very much at risk... But there may be specific situations where crypto may be useful,” Moiseev told a banking conference in Moscow.
Digital currencies have a set of benefits such as no correspondent accounts, instant transactions and practically no compliance procedures, and these benefits should be taken advantage of, for example, in foreign trade, the deputy minister suggested.
Cryptocurrencies cannot be used to circumvent sanctions, however, as transactions carried out in the most popular coins are monitored by financial intelligence in all countries, he added.
Russian importers and exporters have encountered a “colossal number of difficulties” while trying to carry out transactions, Moiseev stated, referring to Western sanctions that essentially cut the country’s businesses off from the international banking system.
Russian companies should be able to use “any available non-criminal” means to be able to carry out foreign trade, he explained, adding that the government is seeking to remove as many barriers as possible, and has started to employ measures that were “unthinkable” before.
Russian legislators are currently debating a law that aims to set the rules for the use of cryptocurrencies in foreign trade and the conditions under which crypto miners can sell their coins.
There is limited regulation of cryptocurrencies in Russia, although there is a ban on payments for goods and services.
There are still no uniform international laws that regulate cryptocurrencies, which are notorious for their high volatility. The most popular crypto, Bitcoin, was worth a fraction of a cent when it was launched in 2009 and shot up to nearly $69,000 per coin in November 2021.
The rate has mostly been on a downward spiral since then, with the decline triggered by fraud allegations, government lawsuits and investigations, and general global economic instability. Bitcoin currently trades at nearly $29,000 per coin.
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