Noises coming out of the Central Bank of Russia indicate that crypto will not be allowed to compete against a digital ruble, and that there will be no place for it in the Russian financial system at all.
While perhaps not going as far as the China ban on all cryptocurrency transactions, the Central Bank of Russia (CBR) is letting it be known that cryptocurrencies will not be allowed to interfere with the roll-out of its central bank digital currency (CBDC).
A prototype for the digital ruble is believed to be now ready, and as is the case with China, the Russian central bank does not want its citizens’ interest in cryptocurrencies to have any effect on its own centralised digital currency.
Pilots of the digital ruble will take place in January. Several Russian banks will be involved, and the trials will continue into 2022. The first stage will involve consumer-to-consumer operations, while the second will test transactions between private individuals and corporations.
In a previous Crypto Daily article, it was detailed how a softening of the hitherto hardline on cryptocurrencies would allow citizens to purchase and hold cryptocurrencies, but not by way of the Russian financial markets.
A crypto working group is due to convene at the Duma this month. It will review the report published by the CBR, although no major changes are expected to the Russian stance on cryptocurrencies.
It seems rather unfortunate for Russian citizens that their country has decided to go down a similar road to China as regards further controls over them.
Both countries have a similar history of authoritarian control in this respect, and being a citizen in either country has held challenges to rights and freedoms that would be taken for granted in most of the West.
However, even though the Federal Reserve has said that it isn’t thinking of going down the CBDC route yet, its treatment of crypto has also been far more negative than positive over recent years.
It might also be argued that the way the Federal Reserve is acting in regards to monetary policy may mean that the “country of the free” could well follow in the Russian and Chinese footsteps in the future.