Bank of Russia backs cross-border crypto payments vs. domestic trade

Published at: June 16, 2022

Russia’s central bank governor Elvira Nabiullina is the latest official to confirm that the country is warming to the idea of cryptocurrency payments, but not domestic ones.

According to Nabiullina, cryptocurrencies can be used in cross-border or international payments only if they don’t get into Russia’s domestic financial system.

The digital currency should not be used as payment on platforms inside Russia, the Bank of Russia governor said in an interview with the local news agency RBC. That is why cryptocurrency prices are too unstable or volatile, thus risky for retail investors, Nabiullina argued, stating:

“Cryptocurrencies should not be traded on organized marketplaces because these assets are too volatile, too risky for potential investors.”

Nabiullina went on to say that digital assets must comply with all requirements and policies created to protect investors. As such, all assets that are listed on an exchange must have an emission prospectus and a responsible person as well as comply with information disclosure requirements.

The governor previously called on the government to focus on encouraging the development of digital asset projects that are being issued by a responsible person in April. She contrasted such a vision to private cryptocurrencies like Bitcoin (BTC), which don’t have one responsible party, while Bitcoin’s creator has not been identified at all.

Nabiullina’s latest remarks provide another confirmation that Russia might be preparing to start using cryptocurrencies for international trade. In May, first deputy governor of the Russian central bank Ksenia Yudaeva claimed that the Bank of Russia was open to allowing the use of cryptocurrency for international payments.

In October 2021, Russian President Vladimir Putin declared that it was “still premature” to use cryptocurrencies for settling trades of energy resources such as oil.

While growing increasingly interested in international crypto payments, the Russian government has been also doing its best to prevent Russians from using crypto as payment insi the country. After officially banning crypto payments as part of Russia’s major crypto bill in January 2021, the local lawmakers on Tuesday passed in the first reading another bill to prohibit the use of digital financial assets.