Russian Finance Minister Anton Siluanov said that cryptocurrencies should not be banned as advocated by the central bank, but instead, the government should fix the ongoing crypto regulation predicament.
The ban proposed by the Bank of Russia stated that cryptocurrencies trading and mining could potentially cause financial instability, but the financial ministry contradicted the proposal and President Vladimir Putin called on authorities to find a consensus.
The argument between the finance ministry and the central bank regarding cryptocurrency regulation in Russia has been ongoing for a year and the government is now expected to work on a solution to clarify the status of crypto in the country.
“We will go to our superiors with these disagreements to try to solve the discords,” Siluanov told reporters.
In order to gain a better advantage in this debate, later this week, the finance ministry will file its proposals to the government on how to regulate cryptocurrencies.
The finance ministry of Russia believes that crypto mining should not be banned, but legalisation and taxation should be introduced, while banks and bourses should identify participants trading in the cryptocurrency market.
Reuters reported that Russians have used cryptocurrencies in annual transactions worth about $5 billion.
Siluanov said:
“If we ban cryptocurrencies, then we need to ban the internet. We don’t use the methods that China uses,”
While, the Bank of Russia has called for a further adjustment of its cryptocurrency regulation, pointing to the experience of India and China – who in September last year intensified its crackdown on cryptocurrencies with a blanket ban on all crypto transactions and “mining”.
Meanwhile, Valeriy Lyakh, head of the central bank’s department for countering market misconduct, also reiterated his institution’s stance that cryptocurrencies carry risks in financial services.
“We do not consider it feasible to take cryptocurrencies to the regulatory field,” he said.
According to a recent report by Moscow-based news outlet The Bell, data collected from Russian authorities showed that the country could earn 1 trillion rubles ($13 billion) each year by taxing cryptocurrency transactions.
The global crypto market capitalization was $1.87 trillion in 2021, with a 12% share coming from Russians. The report further added that Russians form 10% of the crypto users or 12 million people who use foreign cryptocurrency exchanges, the report added.
Previously, Bloomberg reported that Kremlin estimated the Russian cryptocurrency market values more than 16.5 trillion rubles ($214 billion), which is around 12% of the total value of global crypto market capitalization – a number significantly higher than the $5 billion put forward by the central bank.
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