Russian Economist Calls Strategic Bitcoin Reserves a ‘Ticking Time Bomb’
A leading Russian economist has warned Moscow against developing a national strategic Bitcoin reserve, calling crypto stockpiles a “ticking time bomb.” Per the Russian media outlet MoneyTimes.ru, the comments came from Valentin Katasonov, the Chairman of the S. F. Sharapov Russian Economic Society and a Doctor of Economics.
Russian Economist: Strategic Bitcoin Reserves Talk ‘Like Laying Landmines’
Katasonov said he was concerned about the need for Russia “to take a cautious approach” to the idea of “creating a crypto reserve.”
The economist used an allegory to explain his point of view, equating creating a national crypto reserve to “laying landmines” in Russia. Katasonov claimed that cryptoassets were “not fully fledged” forms of “money,” but “rather speculative tools that can pose threats to the economy.”
“[Talk about creating strategic crypto reserves] is way of inflating bubbles. If the bubble bursts, everything will be fine as long as the economy holds up. But, regardless, there will still be many victims.”
— Katasonov
Economist: ‘Russian Crypto Advocates Are Fifth Columnists’
Katasonov hit out at crypto advocates who call for the “introduction of tokens” into “the official economic system.” He called them “fifth columnists,” and suggested they intended to “undermine the country’s economic security.”
The economist also cast doubt on other countries’ plans to launch strategic Bitcoin reserves. He noted that “while some countries, such as the United States, are considering creating Bitcoin (BTC) reserves,” the process was “still far from practical implementation.” Katasonov concluded that “no country” in the world has yet “had a successful experience launching official crypto reserves.”
Some critics may point to the example of El Salvador, whose government embarked on a bullish program of Bitcoin buying in 2021. However, in recent months, the question of El Salvador’s BTC-purchasing has come under the spotlight of the International Monetary Fund (IMF), which disapproves of the nation’s Bitcoin pivot.
Central Bank Opposes BTC Stockpiling
Russia’s Central Bank has recently ruled out the idea of creating a Moscow-based BTC strategic reserve. The nation’s finance ministry has also said that the state will continue exclusively buying gold and Chinese yuan for the time being. However, the ministry this month claimed that should the National Welfare Fund’s level of liquid funds reach a level equivalent to 7-10% of Russia’s GDP, Moscow could “consider” buying “riskier” and “higher-volatility” assets such as crypto.
Regardless, Moscow appears increasingly keen on crypto, with some prominent lawmakers expressing a cautious interest in developing a Russian state-run BTC fund. Some have claimed that failing to “respond” to Washington’s plans to create a BTC stockpile will allow the US to take the lead in the crypto sector. In late December last year, Finance Minister Anton Siluanov spoke to university students who asked him about creating a Russian crypto reserve. Siluanov stated that the Treasury should accept that buying lower-risk assets would let Moscow “earn less, but keep its powder dry.”