Russian President Putin Calls Cryptocurrencies “High Risk” Assets
It appears that the president of Russia, Vladimir Putin, holds on to his previous opinion about digital assets. Putin has again said that cryptocurrencies are high-risk investments. He reiterated his opinion about cryptocurrencies again, many months after he earlier said that they carry a substantial amount of risk, although they have value.
Putin noted this while giving his remarks at a forum in Moscow on Tuesday. The investment forum is convened to discuss economic issues in the country’s capital. Putin, when he spoke, criticized cryptocurrencies as being unbacked, unregulated, and carrying a significantly large amount of risks. He noted that he would not be listening to “those people” who talk about cryptos.
Putin’s comments are especially important because they come at a time when cryptocurrencies face an uncertain future in many countries. In Russia, for example, the crypto industry is new and relatively underdeveloped. Yet, annual crypto investments in Russia have surpassed $5 billion so far.
His remarks were obtained and translated by Cointelegraph from a local Russian media company, Lenta ru. Putin went on to say that he desires stronger regulations and control on the crypto industry. Russia currently has no functionally crypto regulation but reports say that the Kremlin is working on that.
Paving a Path for CBDC?
The Central Bank of Russia (CBR) announced in early November that it would roll out its central bank digital currency (CBDC), the e-Ruble, in early 2022. According to the governor of the CBR, Elvira Nabiullina, the e-Ruble will be tested in its pilot phase before the government will decide whether or not to adopt it.
But there are legal aspects to that; Russia has about 13 laws and legislations that must be amended before the e-Ruble can be launched. But the Duma will do the necessary work if it decides to adopt the CBDC. This might however have negative impacts on cryptocurrencies in Russia, given the President’s stance.
Some Twitter users think that Putin is only toeing the footsteps of its close neighbor and ally, China. China banned cryptocurrencies in September, barely 72 hours after it announced the launch of its CBDC. China’s ban on crypto was seen as a move to pave the way for the adoption of its Digital Yuan.
Crypto Ban in Russia? Fewer Worries for Clinton
Last week, Former US Secretary of State Hillary Clinton, said that she was worried that China and Russia could manipulate cryptocurrencies to undermine the power of the US dollar. Clinton noted that crypto is largely unregulated and could be exploited, together with social media, to harm the US and its economy.
While Clinton’s worries are valid, Putin’s remarks about cryptocurrencies might suggest that the Russian Government may not want to explore crypto. But the Kremlin will want strong regulations to be enforced after it announced in 2020 that it might not outrightly ban the new digital asset technology.
In the US, crypto remains largely unregulated, but there are proposed regulatory frameworks by at least three government agencies to implement for the industry.
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