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Russia wants to create surveillance system for cryptocurrency trading
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The Central Bank of Russia announced a plan to develop a new platform aimed at combat illegal financial activities such as unregulated cryptocurrency over-the-counter services. The initiative is the result of a collaboration with Rosfinmonitoring and financial institutions.
According to the announcement, the idea is to track and block suspicious transactions, facing the challenge of “droppers”. In other words, individuals who make their bank accounts available for illicit activities. However, experts warn of the risk to citizens who trade cryptocurrencies, a practice permitted in the country.
According to a report by the RBC newspaper, individuals are making their bank accounts available to criminals involved in illegal activities, such as money laundering using cryptocurrenciescan move money. Called “droppers”, these individuals open accounts in multiple banks, with the aim of making their illicit activities difficult to detect, disguising the origin of the funds.
Currently, in Russia, monitoring of illegal financial activities is limited. You banks carry out monitoring on an individual basis. Thus, even if a bank identifies a suspicious customer, it is not possible to share information with other financial institutions. As a result, criminals can open accounts at different banks, making it difficult to identify and even block their transactions.
Monitoring Cryptocurrency Activity in Russia
According to Bogdan Shablya, head of the Central Bank’s Financial Monitoring and Currency Control Service, the proposed new platform will centralize data. In this way, it will allow the Central Bank share information about suspicious activity with all financial institutions.
Despite the support given by the main Russian banks, the project has received some criticism from experts concerned about the system’s effects. One of the main concerns is the risk of improper labeling. Bona fide citizens who buy and sell cryptocurrencies can be labeled “droppers”, resulting in restrictions on access to banking services.
Therefore, the Central Bank of Russia is studying creating mechanisms that help avoid these types of errors. Furthermore, it intends to launch tools to rehabilitate people wrongly included on the list of suspects.
The news of the creation of the surveillance system for transactions involving cryptocurrencies comes at a time when the use of digital assets in the country is increasing. Recently, the government legalized the ownership of cryptocurrencies.
In another recent measure, Russia banned cryptocurrency mining in ten regions of the country, something that should be implemented from January 1, 2025. Kremlin is also using Bitcoin as an alternative to sanctions imposed for international tradeas stated by the Minister of Finance, Anton Siluanov on the Russia 24 channel.
Russia wants to create surveillance system for cryptocurrency trading
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Russia wants to create surveillance system for cryptocurrency trading
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Russia wants to create surveillance system for cryptocurrency trading
