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Cryptocurrency regulations are required, says Russia’s finance ministry

On February 21, the Russian Ministry of Finance proposed a ban on cryptocurrencies and cryptocurrency mining. The minister introduced legislation for digital currencies. He believes that cryptocurrencies are a major threat to the country’s financial stability.

The legislation includes a complete ban on cryptocurrencies. This includes all emissions and operations. Banks would no longer be able to invest in cryptocurrencies and the exchange of cryptocurrencies for traditional currency would be prohibited.

However, there were two proposals for legislation. One of the proposals is to require customer identification in transactions. This would lessen anonymity, which is one of the main selling points of cryptocurrencies.

The second proposal includes the requirement to have a license. Only with this license will you be able to trade with foreign cryptocurrencies.

People who obtained the license would be allowed to invest no more than 600,000 rubles. There would be punishment for those who did not follow the rules. Instead of being able to invest 600,000, your limit would be reduced to just 60,000 rubles.

Russia is one of the biggest mining centers for digital currencies. Cryptocurrencies can be used as investment tools, says the minister. However, they would not be allowed in payment methods.

Great risks of cryptocurrencies being used in illegal actions

The head of the central bank’s financial stability department – Elizaveta Danilova said that anyone leaving the country will be able to own cryptocurrencies. They would be able to use them abroad. Regardless, your holdings will be tracked by regulators.

Danilova says there can be a lot of problems with allowing cryptocurrencies to govern finances. It can cause money laundering and be a chain for many illegal operations.

She also mentioned that they took a long time to clear the system of other dubious operations. This includes many banks that have tried to misuse cryptocurrencies. Once the problem is overcome, it should not be allowed to go back through the back door, says the governor.

In the report, it is also mentioned that it is of great importance to ban the use of Russian financial infrastructure to obtain cryptocurrency. Danilova thinks this would be a good way to make the cryptocurrency less popular in Russia.

Russia is a thriving mining industry

As mentioned earlier, Russia is one of the biggest cryptocurrency miners in the world, alongside the US and Kazakhstan. Good conditions in the northern parts of the country allow cryptocurrencies to be mined with cheaper energy. Some of the biggest services in the industry are BitRiver and BitCluster.

Banks have drawn attention to people saying that cryptocurrency mining is bad for the environment. It consumes about 110 Terawatt Hours of energy per year. Therefore, cryptocurrency mining is considered a major emitter of greenhouse gases.

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About the author

Archu

I am CBC, I am a Crypto expert and a part-time blogger. I usually write about how and where to buy crypto coins in legit ways.

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