- Bank CEO cites government’s anti-crypto sentiments
- Russian Central Bank has been sending mixed signals
- Their Crypto work may survive through Swiss subsidiary
The largest Russian bank, Sberbank has cancelled its cryptocurrency plans. The bank cited what it called anti-Bitcoin sentiments from the government regulator.
Russian banks suspending all crypto-related projects
The bank whose CEO Herman Gref, is ironically a Bitcoin proponent, made the announcement during a May 30 press conference, as reported by TASS news. According to the statement by the head of global markets at the bank Andrey Shemetov they were suspending all crypto-related projects because others are yet to become convinced of the merits of digital currencies. Shemetov told TASS:
“We waited for legislation that allows you to trade cryptocurrencies. Since the regulator is currently looking negatively [at Bitcoin], we decided to suspend our cryptocurrency plans.”
Mixed Signals from Russian regulators
It’s difficult to pinpoint what the regulator has done or said regarding cryptocurrencies to make Sberbank shelve its plans. The Russian Central Bank has been sending mixed signals and the news doesn’t come as a complete surprise since Russia abruptly postponed the roll-out of the highly expected crypto regulation last week.
It should be remembered that in February Russian President Vladimir Putin ordered his government to adopt crypto regulations by July 1, 2019 but those plans were shelved last week. An official with the Russian Duma warned then that Bitcoin had the capacity to ruin governments by facilitating the offshoring of huge amounts of money.
No longer a priority
Two weeks ago, Russian Prime Minister Dmitry Medvedev said that authorities in the country were no longer making cryptocurrency regulations a priority. Putin is on record saying that Bitcoin’s anonymous network attracts criminals and facilitates money-laundering. He stated:
“[The risks include] opportunities to launder funds acquired through criminal activities, tax evasion, even terrorism financing, as well as the spread of fraud schemes […] we have seen how Bitcoin has transformed a payment unit into an asset which is bought in order to obtain a high yield in a short period of time. This is the definition of a pyramid.”
Some plans may survive through a Swiss subsidiary
Sberbank’s cryptocurrency plans started way back in February 2018 when the Russian banking giant announced it was planning to unveil a cryptocurrency exchange for its customers. Several months later the firm said it was testing cryptocurrency investment platforms in partnership with Alfa Bank, another large Russian bank. Should the plans to pursue the crypto option fail at home, there are chances the bank could continue with its plan abroad through its subsidiaries seeing that the firms proposed crypto exchange would be launched via its Swiss subsidiary.
