Russia Abandons National Crypto Exchange to Focus on Regulation

Local media report that Russia has decided to cancel plans to launch a national crypto exchange. The country had planned to launch the exchange to mitigate some effects of the sanctions imposed by international institutions due to the invasion of Ukraine.

Priority of Crypto Regulation

Media reported on May 29 that the idea has been completely discarded. Instead, the government will first focus on creating rules and regulations for the crypto industry.

– Since exchanges will assist businesses in cross-border settlements, restrictions may begin to be imposed on them. At the same time, new organizations will emerge. We agree with this concept in the Ministry of Finance. Market participants are convinced that the new mechanism will help reduce the risk of sanctions and the likelihood of cyberattacks, as well as support market competition – said Anatoly Aksakov, Chairman of the State Duma Committee and member of the National Banking Council.

Regulation seems to be the key focus of Russian authorities at this moment. Other Russian lawmakers have agreed on this and are hesitant to launch an exchange without established rules.

Russia first revealed its plans to launch a crypto exchange in December 2022. At that time, the mentioned expected launch date was June 2023, but it now seems that it could be postponed indefinitely, if it is even launched at all.

Russia is now turning its attention to creating a framework for existing crypto companies. Instead of focusing on its own platform, it will create rules that support existing exchanges by facilitating cross-border transactions.

The Ministry of Finance also supports the new strategy, which was primarily against the national crypto exchange. There is not much information about the specifics of crypto regulation, but Russia is taking broader steps regarding the imposition of rules on the crypto market.

Crypto Could Become Legal in Russia

Among the most notable moves by Russia was the decision to recognize cryptocurrencies as legitimate forms of payment. A draft law is being considered that would recognize crypto as a legal means of payment, potentially joining the ranks of countries like El Salvador and the Central African Republic.

However, these are still just speculations and rumors, with no verified information.

Nevertheless, it would be a 360-degree turn after Putin banned digital payments in July 2022. The industry still seems to exist, as Russia is the second-largest bitcoin miner in the world.