Central Banks Hold Fate of Crypto in their Hands, Says Russian Economist

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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June 26, 2023 06:55 EDT

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A leading Russian economist believes that central banks will ultimately determine the fate of crypto – even if they are not currently “prioritizing” their regulation of the sector.

The comments were made by Nikita Maslennikov, of the Center for Political Technologies and the Director of Economy and Finance Projects at the Institute of Contemporary Development, and reported by Gazeta.ru.

The economist stated that the future was “rather uncertain” for crypto, as much “will depend on the extent to which the market will be regulated.”

Maslennikov suggested that crypto regulation had become a “problem in many countries.” However, he said that central banks “do not consider” crypto regulation to be “one of their main tasks.”

The expert noted that Russia and China both take “a tougher stance” on crypto. China has banned most crypto-related activities, including mining and trading coins. Russia’s Central Bank also proposes a blanket ban – although other government organs take a more progressive approach.

Maslennikov claimed that the US has thus far taken a “softer” approach to regulation.

But, he said:

“The future of cryptocurrencies is nonetheless connected with the regulation of the market by central banks.”

Can Crypto Survive Central Bank Regulation? Economist Gives Verdict

Maslennikov claimed that crypto would not be wiped out totally, regardless of central bankers’ actions. He stated that people’s appetite for “risk and speculation” would ensure crypto’s survival in some form. But he claimed that the future of crypto was “uncertain.”

He explained:

“It is still difficult to imagine crypto [undergoing] any kind of unrestrained, boundless growth, because everything will depend on how […] the [crypto] market will adapt to new regulatory norms.”

“Central banks are not in a hurry,” the economist said. But, he added, firmer future regulation is “already an absolute inevitability.”

Maslennikov opined that it was almost impossible to second-guess central bankers’ actions in the crypto sector. But, he said, the wheels of crypto regulation are now in motion in nations all over the world.