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- Crypto assets transactions are soaring Russia with about $5 billion worth yearly transactions
- The cryptocurrency- related risk in its financial stability is yet low
- Russian financial regulators are concerned if residents began to shift their funds into fiat-pegged stablecoins
- Growing interest for digital currency could become a risk for the nation’s financial stability
Crypto assets have proved their potential and garnered mainstream adoption. Since the beginning of this year, assets like Bitcoin, Ethereum, and meme-coins have witnessed tremendous gains. Recently, the Russian Central Bank has announced that residents have conducted more than $5 billion worth cryptocurrency transactions. It is notable that the Russian financial regulators are concerned if residents began to shift their funds into fiat-pegged stablecoins. However, it is worth noting that the digital currency-related risks to the national financial stability are still low.
Russian crypto users are the most active
Last week, the Russian central bank published its Financial Stability Overview report. According to the report, every year, the residents are making crypto transactions worth $350 billion Russian rubles, which is about $5 billion. On the other hand, the report also highlighted that the cryptocurrency- related risk in its financial stability is yet low. Indeed, most of the transactions are isolated from the mainstream financial system.
It is worth noting that the reports cite a July poll of Russia’s largest banks. Indeed, the study by the central bank has not given any details on such kinds of transactions or how the mainstream banks are identifying such transactions that are related to digital assets. The report highlighted that as per some of the indirect estimates, residents investing in cryptocurrency are among the most active on the market participants.
Cryptocurrency can risk Russian financial stability
Russians interest in crypto assets has continued to surge at a tremendous pace. It is worth noting that Binance, one of the biggest digital assets exchanges, sees Russia as one of the biggest markets. Moreover, the number of Russians are also increasing significantly on other exchange platforms as well.
Following the scenario, the report underscored that such growing interest for digital currency could become a risk for the nation’s financial stability. Simultaneously, the central bank also highlighted that assets like Bitcoin and Ethereum are not backed by anything, and users might lose their hard earned funds due to price volatility, fraud, or cyber threats.
Cryptocurrency’s decentralized nature makes it popular
Virtual currencies are decentralized which gives them a potential to disrupt our mainstream banks. However, such nature of these crypto assets also makes it popular among illicit actors. Such actors uses the assets for money laundering, drug trafficking and terrorism financing. To hinder such activities, financial regulators globally are seeking to bring stringent rules.
