Anatoly Aksakov, chairman of the State Duma’s Financial Markets Committee and known as one of the architects of cryptocurrency regulation in Russia, made striking statements arguing that Bitcoin “will collapse sooner or later.”
Aksakov, in his assessment published in the Russian Parliament Gazette, responded to Russian experts who stated that it is difficult for the Bitcoin price to rise in the short term, and that it could even fall to the $40,000 level next year.
Aksakov, who stated that he has long maintained a cautious approach towards cryptocurrencies, argued that Bitcoin is not backed by any tangible asset.
“Cryptocurrency is actually based on nothing. It’s a kind of hype that grew from people’s interest in computers and the idea of making money by connecting to the electricity grid. According to the basic laws of economics, it’s destined to collapse sooner or later,” he said.
Despite Aksakov’s pessimistic outlook, the Russian government has accelerated its efforts to regulate the cryptocurrency market. While the country’s cryptocurrency market is said to have exceeded $13 billion, Aksakov announced that he is working on a new Bitcoin mining law draft.
The draft bill reportedly aims to “legalize” the mining sector for companies that comply with the rules. The regulations will also include rules for cryptocurrency exchanges and will allow banks to offer cryptocurrency trading services to their customers.
The new bill proposes sanctions for illegal mining activities and the illicit circulation of cryptocurrencies. Last year, the Russian Ministry of Justice proposed a regulation that would allow for imprisonment for illegal miners who fail to pay taxes on their earnings.
According to a law that came into effect in 2024, Russian citizens can mine cryptocurrency in most parts of the country as long as their monthly electricity consumption does not exceed 6,000 kWh. However, mining activities are banned until 2031 in some regions experiencing energy shortages.
Aksakov argued that the crypto market has high volatility and that price movements are often dependent on “numerous subjective factors rather than objective ones.” “If you want to make money, this isn’t the best market. Regardless of your expertise level, the fluctuations are uncontrollable,” he added.
*This is not investment advice.
