Russia will ban the use of cryptocurrencies as a means of payment

Author: Xiu MU

Source: Tweet

According to Russian local website Baza, Russian Deputy Prime Minister Dmitry Chernyshenko said in a letter to President Putin that the Russian Federal Security Service (FSB) has reached an agreement with the Russian Central Bank to prohibit the use of cryptocurrencies as a payment method in Russia.

The FSB has not previously made clear whether to allow or prohibit the use of cryptocurrencies like Bitcoin as a means of payment. The FSB and the country's central bank have been debating how to regulate digital currencies. Although Russian banks firmly advocate that all cryptocurrencies should be banned, the FSB remains open to the legalization of cryptocurrencies and recognizes a regulatory framework in favor of miners.

Now it is clear that the two institutions have finally reached a compromise, and the letter stated that after the government meeting, a decision was made to prohibit the issuance and use of cryptocurrencies as a means of payment.

The letter also stated that the FSB will include a proposal for encryption into Russia's Digital Financial Assets Act, which is likely to be passed by parliament this spring. The FSB's recommendations include that cryptocurrencies can be exchanged for rubles and other fiat currencies only through specialized operators. As a result, Russians will not be able to buy anything with cryptocurrency, but they can exchange it for fiat currency.

Furthermore, even if Russian citizens simply hold Bitcoin and do not use it in any way, they must perform identification procedures through specialized operators.

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