Russia Plans to Recognize Crypto as Currency — What Does It Mean for Global Blockchain Adoption?
The Russian government has just dropped news that might massively affect the blockchain ecosystem as a whole. According to the Russian newspaper Kommersant, the Central Bank of Russian Federation has come to an agreement with the authorities to legally recognize digital currencies like Bitcoin as a form of currency. But what exactly will that mean for the global crypto market?
Will Russia Be the First Major Country to Consider Crypto a Real Currency?
In most countries in the world, cryptocurrency is legal. You can legally buy, sell and own digital currencies without any problem. However, this doesn’t mean that crypto is officially considered a currency like the dollar or euro.
So far, many countries have settled on treating cryptocurrencies like commodities. In other words, while you can buy and sell crypto, digital currencies are not actually considered a legal tender. In practice, this means that banks for example are prohibited from providing crypto services to their clients, or from using digital currencies for settlements.
Because of that, Russia’s decision to fully recognize cryptocurrencies as real currencies might be revolutionary for global blockchain adoption. Up till now, only the small Central American country of El Salvador has recognized Bitcoin as a legal tender. If crypto actually gets embraced by one of the largest countries in the world it will be an event of unprecedented importance.
But is Russia really going to adopt crypto on a nationwide scale?
Is Russia Actually Adopting Bitcoin? Not Really, at Least for Now
First things first: Russia is not going to adopt any cryptocurrency as a legal tender, like El Salvador did with Bitcoin. The only legal tender in Russia will still be the Russian Ruble (RUB).
Instead, cryptocurrencies will be recognized as “analogues of currencies”. In practice, this means that crypto operations will be subjected to exactly the same regulations as transactions involving fiat currencies.
From the point of view of retail crypto investors, the new law will require them to report all crypto transactions over 600,000 RUB (8000 USD). While this might seem like a nuisance for cryptocurrency holders, the potential benefits might greatly outweigh the downsides.
Most importantly, the regulations will finally allow financial institutions like banks to own and trade digital cryptocurrencies, and to provide crypto-related solutions to their users. This can be potentially an immense breakthrough for global blockchain adoption, as currently the banks in almost all countries in the world are not allowed to dabble in crypto.
While Russia might not be fully adopting crypto just yet, the fact that one of the largest countries in the world will finally recognize cryptocurrencies as equal to fiat currencies is massively important. It means that the worldwide adoption of blockchain technology is undeniably gaining momentum. Grand Time is dedicated to help accelerate this process and make the transition from fiat to crypto as smooth as possible by teaching millions of individuals how to use cryptocurrencies securely in an easy way!
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