December 9, 2022

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Bank of Russia is opposed to the use of privately issued stablecoins

2 min read

The Bank of Russia takes a stance against the use of private stablecoins inside the nation

In the latest development of the ongoing conflict between the Central Bank of Russia (CBR) and the Ministry of Finance in the country, representatives of the former have criticized the latter’s idea of supporting stablecoins, which some private investors have sought to launch in the country. This dispute has been going on for a long time.

According to Ivan Chebeskov, head of the ministry’s Financial Policy Department, the Ministry of Finance of the Russian Federation (Minfin) usually favors legalizing the circulation of stablecoins in the nation. This information comes from the Ministry of Finance of the Russian Federation.

The discussion of Russia-based stablecoins, which was initiated by Chebeskov one week ago, was shot down, according to the local media, by an anonymous official of the central bank.

At the time, Chebeskov expressed the support of his ministry for the creation of stablecoins that would be related to assets such as “the ruble, gold, oil, or grain.”

He referred to it as the proper road for creating new technologies and strongly encouraged private businesses to experiment with this form of a financial instrument if they determine that it is essential.

The speaker at the CBR conference said that private stablecoins are associated with greater risks than public stablecoins due to the fact that the issuer does not own the pool of underlying assets.

In addition to this, they said that there is no assurance that stablecoins would be redeemed at their original value by the issuer, and that the price of stablecoins is not really that stable, as has been proven all through this year.

In keeping with the typical Bank of Russia statement, the bank’s spokesman underlined that the ruble remains the sole legal payment method in the country and expressed their conviction in the digital ruble, integrating digital payments and national currency dependability.

Local industry analysts say the CBR’s distrust of private cryptocurrencies stems from its digital currency program.

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