Russia to legalise crypto cross-border payments

Thus far, the Bank of Russia has been anti-crypto, probably considering the asset class competition to its own ruble fiat currency. However, the geo-political landscape is such that the Russian central bank has gone as far as to say that crypto cross-border payments are now inevitable.

The Russian central bank has reached an agreement with the Finance Ministry to legalise crypto cross-border payments, as reported by TASS on Monday. 

Deputy Finance Minister Alexei Moiseev even went as far as to say that in the current conditions “It is impossible to do without cross-border settlements in cryptocurrency”.

The Deputy Finance Minister also noted in an interview with the TV channel Russia-24 that the Central Bank was rethinking the approach to the regulation of cryptocurrencies, saying:

“As for the regulation of the cryptocurrency market, the difference in approaches remained. But I can say that the Central Bank has also rethought [the approach] taking into account the fact that the situation has changed, and we are rethinking, because the infrastructure we plan to build is too rigid to use.”

Up till now, the Russian government, including the Russian Central Bank, have been wary of cryptocurrencies as payment methods, and in 2020, a Digital Financial Assets law was passed, which banned the use of cryptocurrencies such as Bitcoin for payments.

Nevertheless, given the continuing war in Ukraine, and the resultant sanctions on Russia by many Western countries, it appears that Moscow has come around to the idea of using cryptocurrencies for cross-border trade, saying that they are a “safe alternative” and given that they can be extremely difficult to trace and to prevent.

Bank of Russia Governor Elvira Nabiullina just added one voice of caution by saying that cryptocurrencies could be allowed for international payments, but only if they did not affect the domestic financial system.

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