The Russian Central Bank (CBR) has introduced new rules requiring stock exchanges to avoid from offering digital currency-related products to investors.
Cryptocurrency products pose a risk, according to the CBR, because of their significant volatility, low liquidity, lack of transparency, and uncertain rules.
As a result, stock exchange executives have been expressly warned not to sell such financial instruments to ineligible investors.
“Managers should not include these assets in mutual funds, and brokers and trustees are advised to refrain from offering pseudo-derivatives with such underlying assets to unqualified investors,” CBR stated.
Moreover, such products, as per the institution, are not suitable for those who have no knowledge about cryptocurrencies.
Remarkably, the bank rejected Russian-compliant Central Bank Digital Currencies. CBR’s latest statement comes after a decision in June 2021 to include digital currency in its survey.
The regulatory environment in Russia for cryptocurrencies
The watchdog’s new approach adds to the nation’s expanding list of cryptocurrency rules. One of the most noteworthy rules forbids Russian government workers from owning cryptocurrency. Furthermore, the government mandates election candidates to disclose any digital currency holdings they may have.
In the previous year, Russia first declares cryptocurrency regulation. The government established a legislative framework that recognizes digital currencies as taxable assets.
The previous year’s rules demonstrated the nation’s desire to move away from a complete prohibition on digital currencies. The legislation permitted banks in the nation to launch digital currency exchanges under the oversight of the central bank.
Furthermore, it has been revealed that Russia is working on a law that will allow police to seize cryptocurrency gained unlawfully.
The government’s action is also prompted by long-standing worries that digital currency may be used to support criminal activities. According to the government, digital currencies are increasingly being utilized for bribes.