Russian authorities will not allow people to borrow money in the form of cryptocurrency, the country’s finance ministry has said. This is in line with its plans for how to regulate the crypto market. People who work for the treasury department said that not all cryptocurrencies will be available to Russian people under the new rules.
The Russian government plans to limit access to crypto assets for investors.
Officials in Moscow don’t plan to let people get loans or use cryptocurrency as collateral, the Ministry of Finance said in a note explaining its new regulations, per the CBC. Russia’s government recently approved the department’s plan for how to deal with the crypto industry. It will be the foundation of the country’s law.
The treasury says that market participants will have to tell people about the increased risks of digital currencies. Russian regulators also plan to put restrictions on and control advertising of crypto-related products and services, Tass news agency said, quoting a document on the matter.
The department suggests that Russian officials think about limiting the number of cryptocurrencies that can be traded in the country to protect investors. Foreign crypto exchanges don’t always check crypto projects, which allows coins from scams and pyramid schemes to be listed, the ministry says.
“In contrast, regulated circulation through licensed exchanges will limit the list of tradable assets and offer Russian citizens access only to the most mature and established cryptocurrencies.”
It also wants to let non-residents buy cryptocurrency on both domestic and foreign-registered digital asset exchanges that have an office in the Russian Federation, so they can buy it. However, these investors will have to withdraw any money from these platforms through banks that are approved by the government.
Russian authorities are now working to make sure that the country’s crypto space is regulated in a very comprehensive way. A proposal by the Bank of Russia to ban all crypto operations was rejected by other government institutions, most of which agreed with the finance ministry and wanted strict regulation instead of a full ban.
As part of the government’s approved regulatory plan, the Treasury and Central Bank have been asked to write a draft law that will follow it by Feb. 18. At the State Duma, the lower house of parliament, legislators will be able to vote on new laws during the spring session.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.