Russia Rejects Crypto for National Welfare Fund

Russia’s Finance Ministry Will Maintain Investments In Gold And Yuan, Excluding Crypto Due To Volatility, While Exploring A Regulated Crypto Trading Framework And Implementing A Taxation System For Digital Assets.

Key Takeaways: – Russia’s Finance Ministry has decided to keep the National Welfare Fund’s investments in gold and yuan, ruling out crypto due to high volatility. – Russian authorities are considering a regulated crypto trading framework for select investors and have implemented a taxation system for digital assets.

Deputy Finance Minister Vladimir Kolychev stated that Ministry of Finance has no plans to alter the investment structure of the National Welfare Fund.

The Russian National Welfare Fund (NWF) will continue to focus on assets like the Chinese yuan and gold only, avoiding riskier options such as crypto.

Speaking to reporters, Kolychev highlighted that digital assets would be excluded because of their significant volatility.

“No. Gold and yuan,” he said when asked about potential investment changes.

At present, the Russian National Welfare Fund’s portfolio consists of approximately 60% yuan and 40% gold. The deputy minister rejected rumors regarding Russia’s potential creation of a strategic cryptocurrency reserve, similar to ideas previously suggested in the United States.

“This is more of a question for the Central Bank. To be honest, I have not heard of such discussions,” he added.

Although the government has shown hesitance in incorporating cryptocurrencies into its national investment plans, digital assets are increasingly becoming prominent within their financial sector.

Changes in legislation have allowed Russian companies to use Bitcoin and various other cryptocurrencies for international transactions, especially as Western sanctions make trade with vital partners such as China and Turkey more challenging. Numerous foreign banks have taken a cautious stance towards Russian transactions, concerned about potential regulatory oversight from Western authorities.

President Vladimir Putin has initiated measures to promote cryptocurrency adoption in foreign trade, and the country has also legalized Bitcoin mining. However, the development of a central bank digital currency (CBDC) has encountered delays, and the country faces ongoing regulatory uncertainties regarding digital assets.

Additionally, Russia has implemented a taxation system for cryptocurrencies, with rates ranging from 13% to 15% based on income levels, as reported by the local outlet Interfax.

Disclaimer: The information on this website is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency markets are volatile, and investing involves risk. Always do your own research and consult a financial advisor.