Credit rating agency Fitch reportedly introduced a new research report on January 28th regarding the ban proposal from the Russian central bank. 

Specifically, regardless of the narrative of the report siding with the Central Bank of Russia’s (CBR)’s idea for the proposal to limit the potential risks associated with crypto, it reportedly pointed out that a proposal of that kind could “hold back the diffusion of technologies that could improve productivity.”

“Suppose this slows the spread of crypto-driven innovations that, for example, improve the speed and security of payments or asset liquidity via tokenization. In that case, it could over time weaken this aspect of the Russian banking sector’s operational environment relative to peers.” Fitch reportedly issued further warnings. 

Moreover, Fitch reportedly also issued remarks related to the adoption of a national central bank digital currency (CBDC), claiming that “[the digital ruble]” should amplify the government’s capacity for financial flows management and monitoring. 

The report further offered clarifications that the main reason fueling the CBR’s proposal of strict crypto laws could be to bring down competition against its upcoming CBDC.

Russia’s crypto regulatory landscape – bearing similarities to those of India – has reportedly been messy recently, where regulators frequently swing back and forth between an outright ban on virtual currencies and urging for the authority to come up with a proper regulatory framework. 

“I’ll say it frankly — when they try to ban something, it very often leads to the opposite result of what is intended. But the position of the Central Bank has, of course, its own reasons, which are also known to everyone.” former Russian president Dmitry Medvedev reportedly remarked regarding the crypto ban proposal.