The Bank of Russia’s governor, Elvira Nabiullina, recently made it known that the financial institution’s stance on cryptocurrencies has not changed, and as such continues to adopt a hostile attitude towards the new digital asset class. This development comes around the time when there has been an increase in criticism regarding how the bank tends to handle the regulations pertaining to digital assets in general.
The bank remains adamant that cryptocurrencies are more harmful than anything else and should not be supported, despite the fact that many believe the country is actively failing to capitalize on the crypto craze due to the approach that has been adopted.
‘Crypto is extremely dangerous’
The governor had admitted that the bank does not think highly of cryptocurrencies, even going as far as to view the crypto industry as being extremely dangerous and detrimental to the global financial landscape. Elvira had talked about cryptocurrencies alongside several other investment spaces, which had also been deemed to be high risk, such as but not restricted to foreign exchange markets. Regarding crypto assets, the governor believes that due to the speculative nature of cryptocurrencies, the risk is even higher. This makes sense to an extent, too, as the crypto industry often exhibits abnormally high levels of volatility.
Moreover, the governor believes that the prices were seen in the crypto market only prove the point that she is trying to make, as many investors are currently experiencing massive losses even as we speak. She, therefore, wanted to reiterate that everyone should stay away from cryptocurrency investments and trading activities as much as possible in order to avoid any potential losses.
‘Bitcoin is fake’
The governor had previously stated on more than one occasion that digital assets such as Bitcoin (BT) are essentially ‘fake money. These assets should thus never be utilized for the purposes of settlements within the country. Interestingly enough, Nabiullina had referred to cryptocurrencies in 2017 as a new form of a modern-day ‘gold rush’.
Nevertheless, the governor is not completely against the idea of digital assets, so long as there is adequate backing provided by the government. This is because the country has plans to issue a CBDC with the potential launch of the digital Ruble. The Russian CBDC, if implemented, would also go a long way towards helping out the local businesses by reducing the involvement of financial intermediaries.