Russian central bank official speaks out against private stablecoins as a means of payment

Planning the release of its own digital ruble, at least one official within Russia's central bank seems to be looking askance at private stablecoins. 

Ivan Zimin, who heads the Central Bank of Russia's Department of Financial Technology, said in remarks Friday before a Russian trade association that stablecoins are a problem for the ruble's dominance within Russia. He went even further, saying that limitations are likely on the horizon.

"We have already taken the first step in restricting the use of unsecured cryptocurrencies and we will likely take a second by limiting the use of stablecoins in making payments," said Zimin. 

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With the CBR planning to release a prototype of a digital ruble later this year, Zimin's remarks indicate some defensiveness in the face of private competition. "Stablecoins, unsecured private cryptocurrencies, various other monetary substitutes cannot be used as means of payment," he said.

Russia has been wrestling with its approach to crypto for much of the past year. A recently signed law "On Digital Financial Assets" similarly affirmed that cryptocurrencies, while legal to trade, "are not a legal means of payment in the territory of the Russian Federation." Stablecoins, however, have been picking up steam even at the highest levels. 

Sberbank, the largest bank in Russia, has announced plans both for a blockchain-backed platform for asset trading and an application with the central bank to issue its own ruble-backed "Sbercoin."

About Author

Kollen Post is a senior reporter at The Block, covering all things policy and geopolitics from Washington, DC. That includes legislation and regulation, securities law and money laundering, cyber warfare, corruption, CBDCs, and blockchain’s role in the developing world. He speaks Russian and Arabic. You can send him leads at [email protected].