Why report of Russia’s recognition of cryptocurrency feels more like a bad news

In the last couple of days, the global cryptocurrency community has been excited following reports that Russia was set to recognize cryptocurrency as a form of payment.

Of course, it felt like something that should be celebrated because it certainly going to drive up the rate of crypto adoption and maybe encourage other nations to do the same. In essence, at face value, this feels good, but when you dig deeper, the good feeling begins to fade.

Why? Because of the conditions that are likely to be attached. So as the country ponders over legitimizing the use of crypto assets, it is also preparing stringent regulations. The Central Bank of Russia, the Ministry of Finance and the government are looking at ways to regulate Russia’s crypto space.

Make no mistake about it, Russia will not accept a decentralized use of cryptocurrency. The government wants to be able to monitor and control the digital currency space like it does every other aspect of Russian life.

Last month, the Bank of Russia called for a broad ban on cryptocurrency-related activity, including payments, exchange, and mining.

Other agencies, like the finance ministry, objected to the hardline policy suggestion, which came up with its perspective of how cryptocurrencies should be addressed.

The federal government, siding with the Treasury Department, approved a scheme that prioritizes regulation over prohibition.

At the moment all the agencies of government in Russia are trying to align their position in a bid to come up with a regulatory framework accepted by all.

Based on the finance ministry’s ideas, a new law setting complete restrictions for the circulation of cryptocurrencies in Russia is expected by February 18.

Anatoly Aksakov, the chairman of the Financial Market Committee, indicated earlier this week that a draft was already on his desk.

Based on the finance ministry’s ideas, a new law setting complete restrictions for the circulation of cryptocurrencies in Russia is expected by February 18.

Anatoly Aksakov, the chairman of the Financial Market Committee, indicated earlier this week that a draft was already on his desk.

When the draft finally get approved here is what you are likely to see:

• Crypto can only be transacted through the banking system
• Transactions outside the banking system are illegal
• You need a license to accept Crypto payments