Buying Bitcoin is like stepping into a minefield, says Bank of Russia official

The Russian central bank has once again reiterated its negative stance on Bitcoin (BTC), with one of the bank’s top executives comparing the cryptocurrency to a pyramid scheme.

Sergey Shvetsov, the first deputy governor of the Bank of Russia, expressed the authority’s concerns about investing in cryptocurrencies in an interview on Wednesday, warning of the perceived risk of losses by investors.

Shvetsov said local investors have increasingly poured their money into alternative financial instruments he called “technological financial pyramids,” saying Bitcoin is just one of those pyramid schemes. He said many retail investors expect big returns from investing in cryptocurrencies, selling their real estate assets or borrowing to invest in Bitcoin, despite the “huge” risk of losing all their money.

When buying Bitcoin, a person enters a minefield and there is no one to trust but himself, and no one can protect him,” argued Shvetsov. The executive emphasized that the Russian government has no responsibility for investors’ losses in cryptocurrencies:

“There is no need to walk where you are not protected by the Russian Federation, where your money would simply be taken away, and you will not be able to do anything about it.”

Shvetsov had previously made similar comments about the cryptocurrency industry, saying last year that the Bank of Russia did not recognize cryptocurrency purchases as an investment and calling on government and financial intermediaries to discourage Russians from buying cryptocurrencies. As previously reported, the Bank of Russia has also barred local banks from offering crypto services.

Investment in cryptocurrencies has become increasingly popular in Russia. According to a report by the World Gold Council, cryptocurrency was the fifth most popular investment tool in Russia after savings accounts, foreign currencies, real estate and life insurance last year, and was ranked slightly more popular than the investment in gold.

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