Russia's Putin seeks consensus in crypto regulation dispute

Konstantin Shulga, CEO of digital financial marketplace Finery Markets, said the company estimated about 7% of the Russian population owns cryptocurrency. The central bank has proposed banning cryptocurrency mining, the energy-intensive process whereby powerful computers compete against others hooked up to a global network to solve complex mathematical puzzles.

President Vladimir Putin has asked Russian politicians and the central bank to reach consensus, he said on Wednesday, following a clash over how much control is needed on cryptocurrencies as they gain traction in Russia. Representatives from the finance ministry and parliament on Tuesday said regulations, not restrictions, were needed, days after the central bank proposed bans to deal with what it said were threats to financial stability, to citizens' wellbeing and to monetary policy sovereignty.

"The Bank of Russia deals with these issues and regulates them," Putin told a meeting with members of government. "The central bank is not standing in the way of regulatory progress and is itself making the necessary efforts to introduce new technologies into this sphere of activity." Russia for years argued against cryptocurrencies, saying they could be used in money laundering or to finance terrorism. It eventually gave them legal status in 2020, but banned their use as a means of payment.

This year, it plans to test a digital rouble to facilitate payments for individuals and businesses and try to make its currency more global in the face of Western sanctions. Konstantin Shulga, CEO of digital financial marketplace Finery Markets, said the company estimated about 7% of the Russian population owns cryptocurrency.

The central bank has proposed banning cryptocurrency mining, the energy-intensive process whereby powerful computers compete against others hooked up to a global network to solve complex mathematical puzzles. In August, Russia accounted for 11.2% https://ccaf.io/cbeci/mining_map of the global "hashrate" - crypto jargon for the amount of computing power being used by computers connected to the bitcoin network.

Putin said Russia was well-placed when it came to meeting the necessary electricity demand. "We do have some competitive advantages here, especially in so-called mining. I am referring to surplus electricity and the well-trained personnel available in the country," he said.

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