Russia is gearing up to legalize crypto. It could happen in the coming months. But there is a catch. Only decentralized tokens are welcome. Kremlin clearly doesn’t want USD-backed stablecoins in Russia.
Despite the fact that today it is customary to consider Russia an enemy and hate with all our hearts, some news are encouraging.
Russia is a huge crypto market. Any kind of news from Russia should be taken seriously.
The oncoming legalization is definitely a news not to miss.
Especially when the news is so controversial.
Russia set to legalize crypto
The bill first was released in February, but its new edition contains certain aspects that can make you wonder.
Those aspects raised some questions, to say the least.
The new draft proposes that digital currency can be accepted as a means of payment that is not the monetary unit of the Russian Federation.
Here is the catch.
But one thing is stated quite firmly. Russia will only allow decentralized tokens to be accepted.
This likely means that USD-backed stablecoins like the immensely popular Tether (USDT), will not be accepted as payment.
Other aspects of the bill have remained the same since its first draft. It outlines strict licensing requirements for crypto exchanges, and will also restrict the amount of crypto ordinary citizens can trade.
The bill also describes that Russia will also establish a register of all entities trading crypto within its borders, citizens and exchanges alike.
So Russia declares war on stablecoins, why?
A few thought here.
Stablecoins have shown their true power since the war in Ukraine broke out. People who stayed in the country were able to instantly transfer assets to their families who had fled abroad and vice versa with the help of crypto.
And stablecoins proved to be the most useful kind of crypto. Simply because there is no price volatility. When you want your family not to starve it is not about the future price of the token, it is all about how much fiat money can you withdraw after receiving the crypto. And 1 USDT is just 1 US Dollar, which is quite convenient.
This might be thing that scares Russian authorities.
I mean they clearly do not want their citizens to be able to keep saving stable in Western fiat money like US Dollar or Euro. They want to minimize the chances for their citizens to be independent from whatever the government decides to do with the economy.
And stablecoins, like Tether, would immediately allow Russian to bypass these restrictions.
Of course, Bitcoin or altcoins are also a sort of way to keep your savings in a rather different form than Russian Ruble.
But seemingly Russian Central Bank is going to persuade citizens to use mostly its own tokens. Yes, it looks like Russian is getting ready to issue its Central Bank Digital Currency (CBDC), it might be dubbed Digital Ruble, at least until it gets its official name.
Presumably that would be a stablecoin pegged to Russian Ruble.
Russia might even try to make other countries to pay for oil and gas with that stablecoin. But it is just an assumption yet.
How about mining in Russia after crypto legalization?
As of now, crypto mining a major focus of the new bill.
Russia intends to set up a register of crypto mining businesses in the country. The bill will bring mining out of a legal gray area and under the government’s regulation. Mining will be a subject of taxation.
Mining can become a competitive advantage of Russia, the bill claims. Cheap electricity and a cold climate are the two biggest draws.