The Russian Central Bank has disclosed plans to slow deposits to cryptocurrency exchanges to prevent Russian residents from making hasty Bitcoin purchases.
Many of the country's banks have been approached by the Central Bank to encourage them to prevent individuals from making terrible financial decisions by buying cryptocurrencies on the spur of the moment.
First Deputy Governor of the Bank of Russia, Sergey Shvetsov, stated at an international banking event that Russia is considering the impact of cryptocurrencies on its economy, just like many other nations.
Shvetsov said the government is worried that Cryptocurrencies would cause financial disaster for the people.
“As a high-tech financial pyramid, there is a good chance it will all come crashing down.”
He went on to say that cryptocurrencies may crash for a variety of causes and methods and that there are many more reasons why this would never happen.
“It appears to be a land mine from our point of view.”
As a result, the central bank will make it more difficult for consumers to purchase Cryptocurrencies by persuading financial institutions to adopt this proposal.
“With the help of the financial system, we're working to halt payments to crypto exchanges, preventing people from making impulsive purchases of this type of commodity.”
The announcement comes only a week after the Russian government stated it was not ready to acknowledge Bitcoin or other cryptocurrencies because of the huge potential negative economic impact.
Dmitry Peskov, Putin's press secretary, stated that Russia has no reason to recognize cryptocurrencies at this time.
Although Putin has signed a new law to halt earlier prohibitions and enable the country’s conditional cryptocurrency access, the Russian government has remained unfavorable to cryptocurrencies.
The regulation which took effect in January 2021 prohibits individuals and companies from sending and receiving payments in cryptocurrency.
RBK, a Moscow-based business newspaper reports that Russia’s financial watchdog has already commissioned the creation of a cryptocurrency monitoring system.
That way, authorities can keep tabs on Bitcoin transactions and look for signs of fraud.
Despite the difficult times, Russia’s cryptocurrency community is one of the most active in Eastern Europe. The ICO boom that lasted from 2016 to 2018 was mostly driven by Russians who have a strong interest in cryptocurrency.
Therefore, interest in crypto projects such as mining has made the nation one of the world's cryptocurrency sector powerhouses.
Chainalysis, a blockchain analysis tool, has shown that Russia is the world leader in cryptocurrency adoption.
In terms of transaction volume, Eastern Europe has the fourth-largest cryptocurrency market, while Ukraine and Russia are top-ranked nations on our Global Crypto Adoption Index.
Adoption has also been seen to surge at the grassroots level among ordinary cryptocurrency users, a pattern similar to other growing crypto markets like Africa.