The Russian government does not want to make Bitcoin available to the general population of Russia but rather intends to reserve its use for international business transactions.
Elvira Nabiullina, the governor of Russia’s Central Bank, said that the institution is prepared to evaluate the possibility of legalizing cryptocurrency usage inside the nation, but only as part of a legal experiment.
During a news conference held by the Bank of Russia on December 16, Nabiullina noted that it is feasible to regard transactions made via an authorized organization in the country as part of an experimental legal regime; however, in order to do so, a corresponding law is required.
Nabiullina noted that the major concern that the Bank of Russia has always had with regard to cryptocurrencies is that they cannot be used as a payment mechanism.
She went on to say that the central bank is especially worried about the security of investors due to the extremely volatile nature of the cryptocurrency market.
According to Alexey Zabotkin, deputy governor of the Bank of Russia, the Bank of Russia believes that the widespread adoption of cryptocurrencies will inevitably lead to their use as a payment method. While Russia does not formally prohibit its citizens from investing in cryptocurrencies, the Bank of Russia does believe that this will happen.
Zabotkin emphasized that the purpose of Russia’s experimental regime, should it be accepted, would be to encourage the use of cryptocurrencies inside Russia, but only in order to assist international commerce.
The most important crypto regulation in Russia, known as the Law On Digital Financial Assets, would legally ban the usage of cryptocurrencies like Bitcoin for payment purposes in the year 2020.
Despite the fact that the law does not prohibit citizens of Russia from investing in cryptocurrencies, the local cryptocurrency exchanges have not been regulated.
While the Russian government is not prepared to provide its citizens access to decentralized financial instruments like Bitcoin in their own country, it does not want to lose out on the opportunities presented by decentralization on a global scale.
Late in November, Vladimir Putin, the President of Russia, issued a statement condemning the monopoly that exists in the world’s various financial payment systems and called for the establishment of a decentralized, blockchain-based settlement network.