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The Bank of Russia will restrict transfers to cryptocurrency exchanges to prevent “spontaneous purchases of cryptocurrencies”

The first deputy chairman of the Bank of Russia, Sergei Shvetsov, warned Russians about the risks of buying bitcoins. At the initiative of the Central Bank, the banking system was recommended to slow down payments in favor of cryptocurrency exchanges.

In August 2021, the first deputy chairman of the Central Bank of Russia, Sergei Shvetsov, gave a detailed interview to Reuters, in which he called it a “big trouble” that citizens “are investing in alternative instruments that we [ЦБ] we call it pyramid schemes or technological pyramid schemes like bitcoin “, without assessing the possible risks.

In his opinion, many Russian citizens have absolutely no idea of ​​the principles of the capital market. They expect “crazy returns” from investments in digital assets and invest in cryptocurrency, sometimes taking loans, selling personal property or borrowing money from close relatives in order to “just bury their money in the field of miracles.”

Citizens do not realize that the authorities will be unable to protect their investments in financial pyramids in the event of unfavorable developments. Shvetsov compared investing in cryptocurrencies with walking through a minefield and recommends “not going where you are not under the protection of the Russian Federation, where your money will simply be taken away, and you cannot do anything about it.”

The regulator, represented by the first deputy chairman of the Central Bank, regrets that all cryptocurrencies that are represented on the Russian market are extraterritorial instruments, their issuers are not licensed and the regulator does not have the ability to control their release and circulation. Moreover, the Central Bank has already developed a set of restrictions for traditional financial instruments, up to a complete prohibition of their sale or their buyback. The Central Bank can suspend payments to companies with signs of illegal activity, which, without a license, attract money from citizens.

Unable to impose a direct ban on the purchase and storage of cryptocurrency assets by citizens, the regulator has taken a number of preventive measures that can significantly complicate the procedures for the acquisition, storage and exchange of crypto assets.

First, the Central Bank included the operations of citizens in “cryptocurrency exchangers” as undesirable and recommended that banks identify, restrict or block their conduct.

The next step of the Bank of Russia, which was announced by Sergey Shvetsov, will be to work with credit institutions so that they slow down payments in favor of crypto-exchanges. The main goal is to protect Russian citizens from the possibility of making “emotional” purchases of cryptocurrencies.

“We are starting to work with the banking system so that it slows down payments in favor of exchange offices and crypto exchanges, blocking the opportunities for emotional purchases of such products,” Shvetsov said.

He added that the regulator can explain to citizens that this is a “highly risky story”, since it is not protected by the regulator in any way, and the very “storage of cryptocurrencies is associated with a number of risks.”

The Deputy Chairman of the Central Bank of the Russian Federation also said that crypto assets are used to “bypass the regulation in the field of combating money laundering.” In this regard, the Bank of Russia categorically does not support citizens’ investments in this “criminal sector”.

Although the opinion of the Bank of Russia regarding the turnover of cryptocurrencies is expressed in a recommendatory form, in fact, this is a direct indication of the banking industry on the procedure for identifying transactions with cryptoassets.

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