Government estimates Russians own more than 16.5 trillion rubles ($214 billion) in cryptocurrencies, according to a government estimate. The Kremlin and government officials are using the statistics to build a strategy to regulate the industry.
This amount, which equates to around 12% of total worldwide holdings and a third of the market capitalization of Russia’s benchmark stock index, explains why the government prefers to regulate the sector rather than outright ban it. According to two persons working on the plans with the government and the Kremlin who wanted not to be identified because they aren’t finalized, the estimate was established last month by analyzing the IP addresses of the largest crypto-exchange users as well as other information.
Due to the decentralised nature of the investments, there is a broad variety of estimates on how much crypto Russians own. According to the Tass news service, Anatoly Aksakov, the head of the lower house of parliament’s financial markets committee, quoted data in December indicating that Russians possessed cryptocurrencies worth roughly 5 trillion rubles.
If the official statistic is correct, Alexander Filatov, co-founder and CEO of blockchain startup TON Labs, said he wouldn’t be surprised.
“Russians have a lot of money in cryptocurrencies,” he said, “but it’s difficult to value the genuine amount.” “Many people use cash, derivatives, or have two passports and can open a crypto wallet in the name of another person.”
The figures show how prevalent crypto investment has become in the world’s third-largest Bitcoin miner, as central bank officials urge for a blanket ban on the industry and the government takes a more moderate approach.
According to data from the Singapore-based tripleA payment gateway, more than 17 million Russians, or around 12% of the entire population, possess cryptocurrency. According to those involved in the discussions, sixty percent of local crypto investors are between the ages of 25 and 44, and the industry employs over 500,000 local computer programmers.
The government thinks that over 17 million Russians own crypto, according to a spokesperson of Deputy Prime Minister Dmitry Chernyshenko, who supervises the digital economy, but declined to evaluate their overall holdings.
After climbing as high as 1.7 percent earlier in the day, Bitcoin, the world’s most valuable cryptocurrency, was little changed at $38,436.23 at 6:38 p.m. in Moscow on Tuesday.
According to the sources, the 16.5 trillion ruble estimate could be conservative because some dealers hide their activity behind virtual private networks. According to CoinMarketCap, the global cryptocurrency market is now worth over $1.75 trillion dollars after its recent drop.
Taking Advantage of the Hype
Stanislav Koritsky, host of the investBRO podcast and a crypto investor since 2017, said,
“The Russian crypto ecosystem is developing, and there are more and more investors pouring in.” “Many of them are young folks who have little understanding of the market and have jumped in amid the buzz.”
President Vladimir Putin has called on authorities to establish a regulatory compromise after the government and the Bank of Russia disagreed on the future of cryptocurrencies in Russia.
The central bank, which estimates that crypto trade in Russia is worth $5 billion per year, wants mining and trading to be banned, claiming that it poses a threat to the country’s whole financial system.
According to the state-owned daily Rossiyskaya Gazeta, the government is considering a number of regulations, including limiting trade to Russian banks, streamlining the process of shutting overseas crypto-exchange sites, and allowing non-residents access to reputable local exchanges.
While Russia’s security services were thought to be lobbying the central bank for a blanket ban on cryptocurrencies because they may be used to fund opposition groups, the persons said they had subsequently converted to supporting the government’s regulation approach.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.
