Russia Reverses on Crypto Ban

• A recent statement made by Ivan Chebeskov, a director within the Russian Ministry of Finance, suggests that there could be a divide within the Russian government regarding the total ban of crypto mining and trading proposed by the Central Bank of Russian.

• Chebeskov stated that a complete ban on cryptocurrency operations and mining will result in Russia falling behind the global technology industry, and would rather see greater regulation and oversight. “We need to give these technologies the opportunity to develop. In this regard, the Ministry of Finance is actively involved in the development of legislative initiatives in terms of regulating this market.”

• The central bank’s report compared cryptocurrencies to a Ponzi scheme and called for the complete ban on the use of crypto, all crypto trading, exchanges, and mining operations. There are also reports that the Russian Federal Security Service (FSB) was heavily involved in supporting the ban, noting that the FSB is concerned over the number of untraceable funding to opposing political parties and media organizations.

• The sudden reversal could be attributed to the fact that Russia is the third largest Bitcoin mining location after the Chinese crypto mining ban in May. The loss of the crypto mining industry could be costly to the Russian government in terms of tax revenue.