TL;DR
- The Russian Central Bank has deemed the use of stablecoins for domestic payments within its territory as “unacceptable,” citing risks to financial and price stability.
- Stablecoins like USDT and USDC are not recognized as legal means of payment in Russia, where only the Russian ruble holds that status, according to the central bank’s statement.
- The Bank of Russia warns of risks such as credit and technological risks associated with stablecoins, while advancing in the development of its own digital currency.
The Bank of Russia has taken a firm stance against the use of stablecoins within its territory, describing it as unacceptable for domestic payments. In a recent statement, the central financial institution of the Eurasian country asserted that stablecoins, such as USDT and USDC, lack the necessary universality and pose risks to financial stability and prices.
The Russian central bank emphasized that these stablecoins are not recognized as legal means of payment in Russia, where only the Russian ruble has that capability. According to the issued report, cryptocurrencies that maintain a 1:1 parity with the US dollar and other currencies do not meet the requirements of universality and stability expected of a national means of payment.
Furthermore, the Bank of Russia pointed out the lack of global consensus for regulating stablecoins, affirming that these assets are not adequately protected or segregated in terms of their asset reserves. The international regulatory gap is mentioned as a crucial obstacle to their widespread acceptance in financial markets.
Russia Clamps Down on Stablecoins and Pursues its Own CBDC
Despite recognizing similarities between stablecoins and traditional financial products, the Russian central bank cautioned against risks, including credit and technological risks associated with these digital assets. Additionally, they highlighted the risk of complete fund blockage, either at the discretion of issuers or due to international restrictions imposed, such as economic sanctions.
In contrast to its restrictive stance, the Bank of Russia is advancing the development of its own digital currency, its own CBDC, aimed at bolstering financial autonomy and facilitating international transactions. The statement should be understood in the country’s efforts to de-dollarize its economy and mitigate the effects of international sanctions imposed by entities like the European Union and the United States.
Beyond the international context and underlying reasons, the Bank of Russia’s statement represents an assault on the financial autonomy of its citizens, who have been systematically subjected to financial and political pressures. It is essential to take a stand against such actions from governments seeking to monopolize and control people’s economies.
