The Central Bank vs. the Market: Who’s Steering Russia’s Crypto Direction?

As Russia embraces digital finance, one institution stands at the center of a growing divide: the Central Bank of Russia (CBR). While the government legalizes crypto mining and state-owned banks experiment with Bitcoin products, the CBR remains cautious. It promotes strict oversight, advances its own central bank digital currency (CBDC), and resists broad access to cryptocurrencies.

The issue is no longer whether crypto belongs in Russia. It’s about who controls how it’s used.

>>> Read more: Russia Crypto Policy: From Ban to Regulation

The CBR’s Original Position: Total Rejection

In 2021, the CBR proposed a complete ban on cryptocurrency activities. It saw crypto as a threat to financial stability and monetary policy. Concerns included capital flight, illicit transactions, and market volatility. The proposal targeted mining, trading, and ownership alike.

This hardline approach clashed with the Ministry of Finance. While the CBR pushed for prohibition, the Finance Ministry advocated regulation. Their disagreement stalled action. But it also revealed a deeper divide within Russia’s financial leadership.

The Digital Ruble: Controlled Innovation

Though hostile to crypto, the CBR advanced the digital ruble as a state-backed alternative. It positioned the CBDC as a tool for control and oversight.

The central bank’s goals were clear:

• Preserve control over monetary policy
• Enable government-level transaction tracking
• Build payment rails independent of foreign systems

Pilot tests began in 2023 and expanded in 2024. Still, public interest was modest. Most curiosity centered on Bitcoin and stablecoins, not the centrally controlled ruble.

Forced Adaptation: Crypto as a Sanctions Tool

Russia’s invasion of Ukraine in 2022 brought sweeping sanctions. Banks lost SWIFT access. Reserves were frozen. Payment routes collapsed. In that moment, crypto went from threat to necessity.

By 2024, the CBR allowed crypto mining and cross-border payments. But the move came with restrictions. It was framed as part of a limited “experimental regime.” Only “super-qualified investors” could participate.

The bank made space for crypto. But it did so reluctantly.

Current Stance: Cautious Regulator or Reluctant Participant?

Today, the CBR supports a fragmented system.

The CBR remains wary. It warns about DeFi risks and market manipulation. Its public stance emphasizes investor protection and system stability. Even as others open the door, the CBR keeps it half shut.

Institutional Tensions: CBR vs. Ministry of Finance vs. Sberbank

Russia’s crypto framework is shaped by three main forces:

• CBR: Defensive, slow-moving, focused on control
• Ministry of Finance: Open to innovation and pragmatic regulation
• Sberbank: Bold, product-driven, and eager to lead adoption

The Ministry and Sberbank promote growth. The CBR acts as referee. It grants approvals carefully and enforces narrow boundaries.

Strategic Implications

The Central Bank of Russia may never support crypto openly. But its regulatory power is decisive. Licensing, enforcement, and digital ruble strategy will shape the industry’s direction.

Russia walks a fine line between innovation and state control. The CBR’s grip will determine which side it lands on.

Conclusion

The Central Bank of Russia’s crypto policy has shifted. It no longer blocks all use, but it doesn’t fully support it either. Mining is legal. Bitcoin-linked products are emerging. But the CBR is cautious and deliberate.

Russia’s crypto future depends on how far its central bank is willing to yield. The rules are changing, but the referee still holds the whistle.

Coming Next

In Part 3 of this series, we shift focus to Russia’s largest financial institution:
“Sberbank’s Strategic Play: Bonds, Bitcoin, and Market Liquidity”