Economy

Russian central bank proposes ban on cryptocurrencies

Bank suggests prohibiting using, mining of digital currencies

Gokhan Ergocun   | 20.01.2022
Russian central bank proposes ban on cryptocurrencies

ISTANBUL

The Bank of Russia proposed Thursday a ban on using and mining cryptocurrencies to protect financial stability, monetary policy sovereignty and the well-being of the country.

It said overall cryptocurrency market capitalization reached $2.3 trillion, 1% of global financial assets, as of December, and suggested the anonymity of transactions is used for illegal activities.

Russians cryptocurrency transactions totaled $5 billion annually, the bank noted.

The rapid growth of the cryptocurrency market can lead to a bubble in the financial market and they "also have signs of a financial pyramid as an increase in their prices is largely driven."

The bank said some countries have already prohibited cryptocurrencies, such as China and Iran, and it proposed that Russia should also ban its use and mining.

"Cryptocurrency mining creates unproductive consumption of electric power, which threatens the power supply of residential buildings, social infrastructure and enterprises and the implementation of Russia’s environmental agenda," it added.

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