Policymakers in Russia are occupied with a new law to “protect” non-professional investors from rash savings in cryptocurrencies, rendering to reports. Russia requires new laws to be accepted to defend retail investors from crypto-risks, trusts Anatoly Aksakov, the chairman of the Russian State Duma Committee on Financial Markets.

The crypto-future in Russia looks currently blurry. Though its government has spoken about generating Russia's controlled digital currency, holding private cryptocurrency among $1,300 (approximately Rs. 97,500) and $13,000 (approximately Rs. 9.7 lakhs) is a finable and jail-time crime in the country.

Concern Shown:

The government bureaucrats of Russia were concerned that if someday the crypto-market was to crash to zero, Russian crypto-investors should not have to grieve as that would influence Russia's overall economy.

Despite Russia's severe restrictions on crypto-trading, 77 percent of Russian investors trust that investing in crypto is the “most forward-looking” investment, a current report by Russia's Association of Forex Dealers publicized in August.

In the year, the government of Russia had derived a decision to not focus crypto to a thorough ban. Aksakov, former this week, was talking about concentrating on financial consumer protection where he made the declarations. As of now, it remains unclear when this law will come into power.

Cryptocurrencies increase the status in Russia among investors:

Above 75% of Russia’s investors interpret cryptocurrencies like Ether, Bitcoin, and Litecoin as the top “forward-looking” investment in their portfolio, desiring it to gold, as per Russia’s Association of Forex Dealers.

Aksakov pointed out that cryptocurrencies have created new financial opportunities and profits for investors, along with larger risks. In July, the Central Bank of the Russian Federation notified Russian exchanges not to permit securities connected to cryptocurrencies and crypto-assets, low liquidity, citing high volatility and non-transparent pricing, among other risks.

This booms a September declaration from Sergey Shvetsov, the main deputy governor of the Bank of Russia, who stated that such restrictions would blunt the influence of financial harms if the crypto market “collapses to zero.” To that end, the Bank of Russia is watching to curb “emotional” cryptocurrency transactions by retail investors.

Shivangi Mujumdar

CBW - External Analyst

INDIA