Raising claims of its potential financial stability risks, Russia’s central bank proposed a blanket ban on the use, trading, and mining of all cryptocurrencies within its borders. However, with recent reports, the ban looks less likely.
In a January 26 video conference, the Russian President, Vladimir Putin, declared his stance, and it isn’t totally in line with the recent call from the Central Bank of Russia.
Putin Sees Advantages to Crypto Mining
Although President Putin agrees with the central bank’s claims that crypto poses “certain risks, first and foremost to citizens of the country, given significant volatility,” he takes a different stance in the area of crypto mining.
In speaking about crypto mining, President Putin said;
“We also have here certain competitive advantages, especially in so-called crypto-mining. I mean surplus in electricity and well-trained teams present in the country.”The President has now called for a consensus following the central bank’s call for a blanket ban. In line with the President’s stance, Russian Finance Minister Ivan Chebeskov also said that Russia needs “to give these technologies the opportunity to develop.”
Russia is now one of the most attractive mining regions globally due to its cheaper electricity. In Russia, 1 kWh of electricity costs $0.06 for households and $0.08 for businesses compared to France’s $0.2 for householders and $0.14 for business.
Russia is currently the third-largest contributor to the Bitcoin global hashrate, only behind the United States and Kazakhstan.
On the Flipside
- Joining the Russian central bank, E.U. regulator (ESMA) has called for a ban on proof of work Bitcoin mining to save renewable energy.
Why You Should Care
The stance of the Russian President has given crypto enthusiasts a glimmer of hope that Bitcoin would not relive the ban witnessed in China.
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