Industry experts reveal a possible method for Bank of Russia to block crypto

One local industry executive revealed a possible method for the Bank of Russia (BoR) to block cryptocurrency transactions amid uncertainty in Russia’s future of cryptocurrencies.

Forbes Russia reported that Andrey Mikhaylishin (CEO of local crypto payment startup Joys) said that the Russian central banking is currently considering various options to allow its crypto ban.

Mikhaylishin stated that one possible method of preventing debit card payments to crypto-exchanges or wallets using merchant categories codes (MCC) is one. According to the report, employees at Bank of Russia informed Mikhaylishin about this blocking method.

MCC codes, four-digit numbers that credit card processors like Visa and Mastercard use to identify a merchant’s primary business activities, are four-digit numbers. Crypto transactions, for example, are identified by the 6051 MCC Code, while grocery store payments have the 5411MCC code. According to the report, local banks could be forced by the Bank of Russia to ban transactions using the 6051 MCC Code.

The potential plan is still being discussed in Russia. However, some industry leaders have doubted its effectiveness.

Maria Stankevich is a member the Russian Committee on Blockchain Technologies and Cryptoeconomics and told Cointelegraph that MCC-based restrictions could cause transparent businesses to leave the country, but not affect illegal cryptoexchanges.

“I’m 100% certain that if they ban transfers to cryptocurrency with the correct MCC, honest exchanges will be banned from the market.” Grey crypto exchanges will continue to exist, but they will use other codes for transactions.

Stankevich said that the miscoding penalties at Visa and other providers are not sufficient to force illegal crypto exchanges from their operations. There are at least 50 grey crypto-businesses in Russia, according to previous reports. They are located in Moscow City (Russia’s financial district).

He expressed optimism about Russia’s cryptocurrency industry, noting that Russia’s Bank of Russia is the only regulator against crypto adoption.

“We know that the central banks are against crypto and want it banned. But I don’t believe that this will happen for Russia. The central bank is a minority.”

Related: Bank of Russia Governor: It’s possible to ban crypto in Russia

Stankevich said, “I know many Russian high-ranking officials that understand the importance crypto,” Stankevich continued.

This news comes just days after Elvira Nabiullina, Bank of Russia Governor, announced that the Bank would not allow local banks to use crypto. A second bank executive claimed that Russians would only be allowed to invest in cryptos like Bitcoin (BTC), through foreign companies.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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