According to a report, the Association of Banks of Russia, a non-governmental body that represents the interests of Russia’s banking and finance community, has proposed that lawmakers prohibit cryptocurrency storage outside of non-custodial wallets on centralized exchanges.
More than 300 Russian banks and financial organizations have urged lawmakers to make it illegal to store cryptocurrency in noncustodial wallets outside of centralized exchanges, according to local news source Izvestia.
According to the news agency, the Association has sent a letter for consideration to the Bank of Russia, the Ministry of Finance, and the Russian Federation’s Federal Financial Monitoring Service.
Non-custodial or self-custody wallets provide users direct and absolute control of their crypto assets, as opposed to custodial wallets, which entrust the user’s private keys to third parties such as centralized exchanges. Self-custody wallets, when properly protected, make it impossible for anybody other than the owner to transfer the crypto assets contained within them.
The Russian Association of Banks, on the other hand, does not appear to be a fan of allowing consumers to control their cryptocurrency. Due to the “serious difficulties” of seizing crypto on noncustodial wallets from debtors and criminals, the association has devised a framework for foreclosure on such wallets, according to the association’s vice president Anatoly Kozlachkov.
The country is presently weighing two opposing approaches: one proposed by the Bank of Russia, which calls for a blanket ban on all cryptocurrency use and mining, and the other proposed by the Ministry of Finance, which wants to regulate cryptocurrencies within the existing financial system.
Despite widespread calls to ban cryptocurrencies or otherwise stifle their adoption by Russia’s financial community, the Russian government appears to prefer the finance ministry’s more measured approach, which favors regulation over banning
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