04 Mar 2022 · 3 min read

Russian Ruling Party Says Crypto Regulation Will Safeguard ‘Millions of Citizens’

Source: AdobeStock / uskarp2

 

United Russia, the nation’s ruling party, says that some 12% of the population uses or interacts with crypto – and senior political figures stated that it will protect crypto holders with its forthcoming regulations.

The comments came from Anton Gorelkin, the Deputy Chairman of the State Duma’s Committee on Information Policy, while an MP and member of the parliamentary working group on the legislative regulation of crypto, Alexander Yakubovsky, added that the “legalization” of crypto could help Russians struggling with Western-led economic sanctions, per Regnum and Kopeysky Rabochiy.

The MP added that the existing bill submitted by the Ministry of Finance prior to the military operation in Ukraine would allow crypto mining to become a “new type of economic activity,” although he insisted that mining should be divided into two sectors: so-called “home mining” and industrial crypto mining.

Osman Kabaloev, the head of banking regulation at the Financial Policy Department of the Ministry of Finance, added that legally defining terms like “crypto mining” and “crypto exchange” would help achieve this goal.

Gorelkin was quoted as stating that 12% of Russians have had experience with crypto “transactions” in one form or another, and added:

“If you look behind the percentages, that represents millions of citizens. And our task is to protect these people from the threats associated with the shadow circulation of cryptocurrency, fraudulent activities, as well as their use in criminal calculations and the uncertainty of the status of the sites they use.”

The latter point may have been a reference to the fact that many major crypto exchanges are now under increasing pressure to block Russian IP addresses amidst the country's invasion of Ukraine – and even freeze wallets belonging to Russian citizens.

Andrey Turchak, the Secretary of the United Russia General Council, went a step further, claiming that it was “important to carefully approach the regulation of cryptocurrencies as a means of payment in Russia.” Crypto has previously been outlawed as a form of payment.

But the Secretary suggested that there may be wiggle room, as “the digital financial infrastructure is a fully fledged part of the financial system.” If technology solutions were developed “within the law,” this would “provide new and modern tools” for Russian people to make use of – although he also warned of the potential “fraudulent” risks related to crypto.

The Central Bank is reportedly still opposed to all forms of crypto, as well as mining – but may have bigger fish to fry in the sphere of conventional finance.

Komersant reported that euro and dollar exchange rates on the Moscow Exchange – which is still suspended for stock trading – had reached new record highs. At the start of trading, the euro was trading at 125 rubles to the EUR, while the greenback was trading at over 112.

Meanwhile, the Central Bank has decided to slash commission rates for individuals buying foreign currency through brokers to 12%, down from the 30% rate it set earlier this week, per the same media outlet. The bank stated that it was hoping the move would “level competitive conditions in the market and maintain financial stability.”

But there was more bad news for Russia on the international front, with China now looking increasingly unwilling to back Moscow in the financial markets.

AFP, via Yahoo, reported that the Beijing-backed Asian Infrastructure Investment Bank (AIIB) has announced that it will suspend business related to Russia and Belarus.

The AIIB was quoted as stating that “in the best interests of the bank,” its “management has decided that all activities relating to Russia and Belarus are on hold and under review.”

The bank claimed that it was “actively monitoring the situation” in Ukraine, adding that its management team would do its “utmost to safeguard” the AIIB’s “financial integrity.”

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Learn more: 
- Cut Central Bank out of Russian Crypto Regulation Picture, Urges Lawyer as Ukraine War Rages On
- Russian Central Bank Claims its SWIFT Alternative Is Ready

- Russian Finance Ministry Outlines its Vision of Bitcoin Mining Regulation
- Russian Consumers, Firms Feeling Impact of Sanctions as Ruble Keeps Diving

- Russian Oligarchs Unlikely to Use Crypto to Dodge Sanctions - Coinbase CEO
- Washington, Europe Vow to Target Russian Crypto Sanctions Evasion Efforts