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The Russian central bank has recommended that domestic commercial banks block their customers’ crypto exchange-related card and e-pay transactions.
In an official release, the Bank of Russia spoke of the need to stamp out internet-based “shadow economy”-related businesses. It called on domestic banks and e-pay operators to identify all accounts and e-wallets belonging to “illegal business activities” such as “cryptocurrency exchanges,” which it clumped together in the same group as “online casinos and lotteries,” “financial pyramid schemes” and forex dealers.
The central bank said it wanted domestic financial institutions to “block transactions” and “completely stop servicing” transactions made to accounts flagged as “shadow economy”-linked.
The central bank also provided banks with a list of protocols that it claimed would help banks effectively tell the difference between suspected “shadow economy” transactions and bona fide, above-board peer-to-peer business transactions.
And it concluded by repeating a familiar refrain: Explaining that crypto, forex, casinos, and the rest were “associated with high risks of losing money” and “fraudulent schemes.”
The media outlet Kod Durov (the Durov Code) commented that with this new measure, the Bank of Russia had “taken a step to stop the circulation of cryptocurrencies in Russia, despite the absence of direct legal prohibitions on exchanges and trading of cryptocurrencies for individuals.”
The Bank of Russia has been locked in a long impasse with pro-business forces in the government over crypto policy. While the central bank has repeatedly called for a blanket ban on crypto in a similar vein to China’s crypto crackdowns, the Ministry of Finance and other government organs are opposed to this kind of measure.
The resulting stalemate has led to relative inaction in the regulatory space, although some measures have passed, including a ban on crypto as a form of payment and tax reporting obligations on crypto earnings.
Crypto mining, however, continues to thrive in Russia. Bigger businesses are still pushing for tokenization. And the nation’s largest bank and tech giant Sberbank (also known as Sber) has launched a stablecoin – despite the Bank of Russia’s insistence that it also wants to limit stablecoin usage.