Russia to drop setting up of national crypto exchange, instead will focus on regulations
Russian authorities are scrapping plans to establish a state-owned crypto exchange, which was announced in November last year.
Highlights
- The Russian government is halting its plans to launch a state-owned cryptocurrency exchange
- Its central bank is likely to be the main regulatory authority supervising crypto exchanges
As per recent reports, the Russian government is no longer moving forward with its plans to launch a national cryptocurrency exchange. Instead, it will focus on regulating multiple crypto trading platforms as well as formulating rules that will allow private firms to establish such exchanges.
In fact, according to Anatoly Aksakov, a State Duma member, the Russian central bank is likely to be the main regulatory authority supervising cryptocurrency exchanges. Further, its too early to talk about cryptocurrency exchanges in Russia, says Alexey Guznov, Bank of Russia’s deputy governor. Rather, these platforms are expected to act as institutions coordinating interaction between exporters and importers in facilitating cross-border transactions. Moreover, these companies will help Russian firms pay for parallel imports, mentions Guznov.
It must be noted that some of the major crypto firms operating in the country are reportedly averse to the idea of establishing a national crypto exchange. Instead, they are of the opinion of creating a regulatory framework for such organisations.
How have market participants reacted to this move?
The Russian authorities' move to drop the national exchange in lieu of regulated operations has witnessed support from several market participants. BitRiver’s director for government relations, Oleg Ogiyenko, opines that the foresaid move will minimise the risks related to sanctions and cyber attacks on infrastructure. Moreover, it would also address concerns about market dominance.
Also, it has been suggested that special requirements be introduced for foreign crypto exchanges seeking to operate within the Russian shores, including a main focus on ensuring the confidentiality and security of information related to Russian clients.
Ivan Gostev, commercial director at GIS Mining, says that regulation of private entities would ensure competitive development and innovation within the industry and would also protect the users.
