Putin advocated for redirecting these reserves towards domestic investments in infrastructure, logistics, science, and education, suggesting that such allocations would be more secure and beneficial for Russia’s economic development. He criticized the current U.S. administration for leveraging the U.S. dollar as a political tool, arguing that this practice undermines its status as a global reserve currency and prompts other nations to explore alternative assets, including cryptocurrencies.

“Who Can Prohibit Bitcoin? No One”

Highlighting Bitcoin as a prominent example, Putin remarked, “For example, Bitcoin, who can prohibit it? No one.” He acknowledged the growing interest in cryptocurrencies as countries seek more reliable and politically neutral financial instruments. Additionally, Putin noted the inevitable advancement of new payment technologies, attributing their appeal to lower costs and increased reliability.

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This perspective aligns with Russia’s recent legislative actions concerning digital assets. In August 2024, Putin signed a law legalizing cryptocurrency mining, officially recognizing it as a legitimate economic activity. The legislation defines key concepts such as digital currency mining, mining pools, and mining infrastructure operators, and permits only registered Russian legal entities and individual entrepreneurs to engage in large-scale mining operations. Individual miners are allowed to participate without registration, provided their energy consumption remains within government-set limits.

Furthermore, the law allows for the trading of foreign digital financial assets on Russian blockchain platforms, with the Central Bank retaining the authority to prohibit certain assets if deemed a threat to financial stability. Putin emphasized the importance of Russia “seizing the moment” to establish a legal framework for digital currencies, highlighting their potential to contribute to the nation’s economic development.

These developments reflect Russia’s strategic shift towards embracing digital assets and reducing reliance on traditional financial systems susceptible to geopolitical tensions. By fostering a regulated environment for cryptocurrencies, Russia aims to enhance its financial sovereignty and adapt to the evolving global economic landscape.