Russia has decided on a strict ban on crypto circulation to bolster the ruble amidst geopolitical tensions. Amid escalating geopolitical tensions, Russia will implement a stringent ban on circulating crypto assets like Bitcoin, permitting only domestically issued digital financial assets as part of broader governmental control measures over the crypto ecosystem.

The country’s financial ombudsman explained that digital financial assets issued in Russian jurisdiction, and digital rubles will be allowed. The need for a ban is due to the fact that today cryptocurrency is a quasi-currency that replaces the ruble in the country. But only the Russian ruble fulfils the mission of the monetary unit, so this decision has been made.

Balancing tax revenue and security concerns The bill will carve out exceptions for crypto miners and Central Bank-sponsored test projects within an experimental legal framework, as crypto mining significantly boosts Russia’s tax revenues. According to data from Statista, crypto miners produce over USD 2.59 billion in liquidity for foreign trade settlements in Russia. However, there is an intense internal debate among Russian policymakers regarding this approach.

Russians committee on economic policy stressed the importance of precise regulations. In contrast, Russia’s Finance Minister has pushed for a more moderated stance, advocating for regulation to enable the use of cryptocurrencies in both domestic and international transactions. Officials from the Bank of Russia also supports the experimental use of cryptocurrencies in international settlements.

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