Russia Central Bank Mulls Gold Standard for National Cryptocurrency
Russia’s Central Bank could be considering a gold-pegged cryptocurrency, according to a report by Russian news agency, RIA on May 23, 2019. However, the apex bank states that virtual currency would not act as a substitute for the Russian Ruble.
Gold-Pegged ‘Crypto-Ruble’ a Possibility
The Bank of Russia hinted at a meeting at State Duma, the country’s lower house, that it was open to the idea of a stablecoin – in this case, backed by gold, which could act as a means of mutual settlement internationally.
In response to a question from a politician at the meeting of the Financial Market Committee held at the State Duma, Head of the Bank of Russia, Elvira Nabiullina said:
“As for mutual settlements, we’ll consider your proposal on what cryptocurrency is tied to gold. But in my opinion, it’s more important to develop settlements in the national currency.”
Russia, among other countries, has been notably skeptical concerning the cryptocurrency industry. However, in 2018, the country began making efforts towards regulating in the sector, imitating countries like Japan, Malta, and others who have crypto regulations in place.
As BTCManager previously reported, the Russian parliament announced its intentions to legalize the sector at the beginning of Q3 2018. In March 2019, Russian President, Vladimir Putin gave another deadline – July 2019, for the legislature to pass laws regarding virtual currency regulations.
Mati Greenspan, the Senior Market Analyst for eToro, commented on the country’s recent news via his Twitter handle.
The central bank head is considering introducing a stablecoin, as it believed not to be as volatile as bitcoin because it is backed by a more secure asset. Elvira, however, does not mention the particular crypto coin that would be tethered to gold
Cryptocurrency not a Fiat Surrogate
Elvira’s “positive” statement, however, comes with a disclaimer. According to the central bank head, regulators are studying stablecoins which can be viewed in the bank’s regulatory sandbox, but the apex bank is not willing to insert cryptocurrency into the country’s monetary system.
Further buttressing the above, the Nabiullina said:
“We do not see this opportunity for cryptocurrencies to perform the function of monetary surrogates here, and practically do not consider such projects within the regulatory sandbox.”
The governor’s comment mirrors an earlier pronouncement made by Elina Sidorenko, Head of Duma’s Interagency Taskforce for Cryptocurrencies, who said that the Russian Federation was not ready to combine virtual currencies with its traditional financial system in the next 30 years.
Earlier in 2019, Russian Economist and university lecturer, Vladislav Ginko claimed that renewed U.S. sanctions could push Russia into investing in bitcoin, which could happen in a matter of weeks.
However, days after Ginko’s comment, critics said that the Russian economist statements lacked evidence, with Kremlin official, Elina Sidorenko, stating:
“This statement lacks common sense and is out of touch with the ideas that might have been considered in the government circle.”