It should be noted that this shift in attitude towards digital assets in the Russian government's agenda is not coincidental. Global analysts now view crypto as a means to partially circumvent sanctions imposed on Russia. In particular, representatives of the International Monetary Fund voiced such a version the day before. They said that the authorities may try to circumvent restrictions through mining. Read more about this in a separate article.


What happens to cryptocurrencies in Russia

As part of the government’s measures to support the economy, the Bank of Russia is working to bring the topic of digital financial assets into “working order,” Nabiullina said. She stressed that Russia passed its law on cryptocurrencies, On Digital Financial Assets, more than a year ago, but it didn’t help the country get many “real projects” in the field.

As a result, the Russian government is about to pass another legislative initiative, the Digital Currency Bill, which aims to clarify the rules for trading and mining cryptocurrencies.

Elvira Nabiullina, head of the Central Bank of Russia

Nabiullina also hinted that the central bank may reconsider its tough stance on digital assets. Here’s her rejoinder, cited by Cointelegraph.

We need to look at whether we are being too rigid here and whether we need to ease the pressure on these digital financial asset projects. This could be another channel to attract investors.

We think that such statements seem ridiculous. Yet back in December 2021, Nabiullina allowed for the possibility of a "complete ban on digital assets" in Russia because they were allegedly questionable among the main bank government. Now, however, conditions have changed, and amid the harshest sanctions, the Central Bank leadership is suddenly not only thinking about revising its attitude to crypto, but is pitching this as a need to attract investors. Although it is extremely difficult to hope to raise capital in this situation: capital owners may at least be afraid of sanctions against them because of their interaction with the Russian government.

Bank of Russia

The head of the Central Bank has stressed that the government should focus on encouraging the development of initiatives for digital assets that have a “responsible person” who issues them. That is, we are talking about centralised projects rather than individual cryptocurrencies. That said, the Bank of Russia continues to discuss issues related to cryptocurrency mining with the government in order to come up with a systemic solution.

In addition to all of the above, Nabiullina also touched on the subject of the digital rouble (CBDC). She said that the Bank of Russia expects to make the first real settlements with it as early as 2023.

Of course, we are considering the possibility of introducing the digital rouble for international settlements.

Note that plans for the digital rouble do not look realistic either. At least in October 2020, the start of testing of this instrument was promised for 2021 - but there is no timeframe to fit in here either.

Meanwhile, sanctions for Russian citizens are getting more radical: This time, the largest exchange, Binance, has joined them. According to Decrypt’s sources, Binance restricts accounts of Russian citizens with a balance of more than 10 thousand euros. If your account falls into this category, you cannot trade or exchange cryptocurrencies on the platform, but only withdraw them to another wallet. Binance notes that such accounts must be closed within 90 days.

Binance’s tech support department confirms new sanctions

Users must now also confirm their home address during KYC procedures to comply with the new Binance ruling. Accounts with less than €10,000 “will remain unaffected and active”. The same applies to Russian citizens who live outside the state.

As a reminder, the EU announced its latest sanctions package back on 8 April. It affected cryptocurrencies linked to Russia as a means of “closing potential loopholes” to potentially circumvent economic restrictions.

The announcement from Binance also came just one day after the US government imposed sanctions on Russian mining firm BitRiver and its subsidiaries. This is the first time in history that the US government has directly restricted a mining company’s operations.


We think that such a change in the bankers' narrative sounds very amusing. A couple of months ago, they were seriously discussing banning cryptocurrencies and frightening people with excessive volatility of such assets, but now coins have suddenly become a tool to potentially attract investors. At this rate, it is likely that sanctions for the financial sector will actually force Central Bank officials to use cryptocurrencies even for international settlements. However, given the size of the coin niche, this scenario is also unlikely.


What do you think about it? Share your opinion in our Millionaire Crypto Chat. We discuss other important topics there as well.

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