It should be noted that the use of cryptocurrencies by representatives of the Russian Federation was actively discussed this year, with the prospect of circumventing fresh sanctions. However, as US Treasury Secretary Janet Yellen noted, it would be very difficult to circumvent sanctions with digital assets on a large scale. However, it will also lead to increased scrutiny of such transactions, which in turn could lead to problems for other parties in the relevant transactions. You can read more about Yellen’s point of view here.

A similar view was expressed by Ripple CEO Brad Garlinghouse. He stated that crypto exchanges interact with banks to operate their own accounts, well banks certainly won’t agree to try to ignore sanctions. So such ideas are doomed even at a basic level.

What will happen to Bitcoin in the Russian Federation?

Here’s a quote from Nabiullina, voiced during the Central Bank press conference. The speech is cited by Cointelegraph.

It is possible to consider transactions through an authorised entity in the country as part of an experimental legal regime, but that would require an appropriate law.

Central Bank of Russia Governor Elvira Nabiullina

The Bank of Russia’s main argument against cryptocurrencies has always been that they cannot be used as a payment instrument, Nabiullina stressed. She added that the Central Bank is also concerned about protecting investors because the cryptocurrency market is highly volatile.

Cryptocurrencies are also able to show incredible returns during so-called bull cycles, i.e. growth phases. For example, bullrun leaders last year gave out thousands - and at times more than 10,000 - percent increases. However, the Central Bank spokeswoman predictably does not bring this up, well, investors will be "protected" from the opportunity to make money as well.

Although the Russian Federation does not formally prohibit citizens to invest in crypto, the Central Bank believes that the massive introduction of digital assets will inevitably lead to their use precisely as a means of payment. This is how Alexei Zabotkin, deputy governor of the Bank of Russia, comments.

If cryptocurrencies are allowed to circulate freely as an investment instrument within the country, then inevitably, as its ownership expands, it will increasingly be used as a means of payment. This will be impossible to prevent.

However, it is hard to believe that crypto will become legal tender in Russia. Still, it requires a normal infrastructure, which is unlikely to be developed by anyone. One need only think of the mining tax, the idea of which began circulating back in 2017. In the end, over the years, it has not really led to anything.

Alexei Zabotkin, Deputy Chairman of the Bank of Russia

Thus, the Central Bank’s experiment, if it is indeed going to be implemented, will take place in a limited fashion. According to Zabotkin, such measures – as well as the use of crypto itself – are necessary to improve the situation in international trade.

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Individual countries’ distaste for crypto aside, the industry has far more serious troubles – the negative consequences of the FTX exchange’s bankruptcy. One of these is the recent class action lawsuit against Silvergate Bank, Silvergate Capital Corporation and Silvergate CEO Alan Lane. The plaintiffs allege that Silvergate entities facilitated the fraudulent activities of FTX management.

According to Decrypt’s sources, a plaintiff named Joey Gonzalez and “all others similarly situated” entrusted their investments to the bankrupt crypto-exchange FTX. After its collapse, Gonzalez and others involved in the case were left at a loss, so they eventually decided to turn their anger against Silvergate.

Silvergate CEO Alan Lane

It turns out that the publicly traded and federally regulated Silvergate bank maintained accounts for both FTX and the exchange-affiliated company Alameda Research. The plaintiffs allege that the bank was “directly involved in the use of funds, illegal transactions and issuance of loans from exchange users’ money.”


We believe that the current ideas will not lead even close to any recognition of cryptocurrencies. Neither should we expect the coins to be used as an official means of payment. Yet the Central Bank officials will clearly see such a prospect as a risk to their own powers. And that is a reason to suspend any such activity.


How will this affect the bankruptcy proceedings of FTX itself? Follow the developments in our Millionaire Crypto Chat. There we talk about other important topics related to the blockchain industry and decentralised assets in general.