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BOR Closer to Legalising Crypto for Cross-Border Payments

BOR Closer to Legalising Crypto for Cross-Border Payments

(9 September 2022 – Russia) The Bank of Russia (BOR) has authorised the use of cryptocurrency for payments, potentially allowing for cross-border settlements to circumvent Western sanctions.

Russia’s central bank has admitted that the use of cryptocurrencies for cross-border payments is inevitable. Russia has traditionally opposed using crypto as a payment method, mainly to defend the Ruble, however there has been strengthening support for the digital asset class due to pressures from Western economic sanctions stemming from Russia’s invasion of Ukraine in February 2022.

The intention will be to hand Russians the opportunity to use cryptocurrency for international payments and place it under control so that there is no possibility of using it for money laundering, payment for drugs, or other illicit purposes associated with the early use of Bitcoin.

BOR Governor Elvira Nabiullina stated that cryptocurrencies could be used for payments as long as they “don’t penetrate” Russia’s financial system. The bank’s emphasised that the monetary authority and the finance ministry are not endorsing the legalisation of crypto payments or exchange domestically. Russian Prime Minister Mikhail Mishustin previously described digital assets as a “safe alternative” in foreign trade.

“It is necessary to do this in Russia, involving entities supervised by the central bank, which are obliged to comply with anti-money laundering and know-your-customer requirements. The central bank has reconsidered its regulatory approach given that the situation has changed” commented Russian Deputy Finance Minister Alexei Moiseev.

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