The Russians are among the world’s most active participants in the cryptocurrency market, according to the country’s central bank.
The Bank of Russia released a new financial stability review on November 25, highlighting the country’s growing role in the $ 2.8 trillion market.
Citing estimates reported by major local banks in July 2021, the Bank of Russia suggested that the total annual crypto transaction volume of the Russian population is 350 billion rubles, or US $ 5 billion.
It doesn’t seem clear whether the Bank of Russia converted these estimates, as the price of Bitcoin (BTC) has nearly doubled since July, from around $ 30,000 to over $ 60,000 in November.
In the report, the Bank of Russia also noted that the Russian Federation is among the world leaders in terms of visits to the Binance cryptocurrency exchange. According to data from digital intelligence provider SimilarWeb, Russia is the second country in terms of total traffic on Binance after Turkey.
The Russian central bank also noted that Russia is one of the largest Bitcoin mining countries in the world, ranking third among countries in hash rate according to the Cambridge Bitcoin Electricity Consumption Index in August 2021.
Despite admitting Russia’s leading position in the global cryptocurrency market, the Bank of Russia has nonetheless highlighted the major risks associated with the industry, including those associated with financial stability, protection of investors, money laundering, criminal financing as well as ESG risks.
The central bank has not suggested any immediate action to address these risks, but said it will monitor the market closely to identify potential threats:
“The relationship between digital currencies and the financial sector remains limited for now. However, the rapid growth and widespread adoption of digital currencies would pose higher risks both globally and for the Russian financial market. “
Related: Russia’s crypto market is worth $ 500 billion despite poor regulation, executive says
The Bank of Russia has taken a tough stance on cryptocurrencies, with Governor Elvira Nabiullina arguing that responsible governments should not push crypto adoption. The central bank is notorious for not allowing local banks to process crypto and promoting the use of its own digital currency instead. This led to a situation where no Russian crypto exchange would offer its services legally today.