Reports suggest that Russia’s Central Bank could ban crypto mining and trading in the country. Now, it is difficult to say whether there will be a complete ban or strict regulations would be put in place. But it is almost certain that something of the sort is coming. The reason for this, as cited by the authorities, is the well-being of Russians and their financial stability.
Russia against crypto
Crypto adoption is on the rise, and if the same continues then, we could soon move to an era where it is bigger than fiat. This means that governments will lose control, and it will be with the masses. Hence, many governments are taking strict steps to curb this growth. Another reason why Russia could ban crypto is its use in money laundering and terrorism. But if you take a look at the numbers, these illegal activities represent a very small portion of crypto.
Russia also thinks that crypto could affect the financial stability of the country. The markets are very volatile right now, and this could lead to a big problem if crypto crashes. In fact, the idea of this ban and the headlines is one of the reasons for the current market panic. If Russia follows the same path as China, then it will be a negative sign for Bitcoin.
Crypto mining
The ban in Russia will be for both crypto and its mining. Russia’s mining sector is huge and the third-largest after US and Kazakhstan. This is why it will significantly impact BTC’s hash rate. The reasoning authorities are giving for this ban is the energy consumption, but we all know that the use of renewable energy for BTC mining is on the rise. It is already at 46%, according to the Bitcoin council, and will soon be more than half. But still, the bank authorities said, “To save the energy resources, we need to propose a ban on crypto mining.” So, it is clear that a lot of decisions here don’t make complete sense.
If Bitcoin/crypto is banned in Russia, we will definitely see it affect the crypto market. Do you think that Russia’s Central Bank could ban crypto, or will they put strict regulations in place? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.
Also Read: US mining industry is still the largest despite regulatory uncertainties.