Russia Central Bank Flags Cryptocurrency Risks, Calls for Criminal Penalties on Unlicensed Distribution

The Russian Central Bank has classified cryptocurrencies as a financial market risk and argued that those organizing unlicensed distribution should face criminal responsibility. In its report 'Key Directions for the Development of Russia's Financial Market in 2027 and 2028-2029,' the bank highlighted potential risks as Russian citizens increasingly use stablecoins and other digital assets as alternatives to national currency. The Central Bank noted that investing in digital assets carries the risk of losing all invested funds with no liability or guarantee from responsible parties.

The bank further argued that cryptocurrencies circulating beyond national jurisdiction weaken the effectiveness of country-specific restrictions and prohibitions, while the lack of unified international regulation creates conditions for shadow markets to expand. It proposed imposing criminal liability on those organizing unlicensed digital currency distribution and administrative penalties on legal market participants who violate regulations.