Russia has officially slammed the door on Bitcoin when it comes to its National Welfare Fund. That’s right, folks—no shiny digital coins in their wealth management strategy. Instead, they’re keeping it old school with good ol’ gold and the Chinese yuan. Why? Volatility. Cryptocurrencies are like that unpredictable friend who shows up late and drunk to every party. Not exactly what you want in a stable investment portfolio.
Russia is ditching Bitcoin for gold and yuan, opting for stability over crypto’s wild unpredictability.
The National Welfare Fund is all about stability. We’re talking liquid assets that can be sold quickly without sending the price into a tailspin. Bitcoin, with its wild price swings, just doesn’t fit the bill. It’s like trying to use a rollercoaster to get to work. Sure, it’s exciting, but you might end up feeling nauseous—or worse. Investors should be aware that the market behavior of cryptocurrencies can result in quick losses.
Now, Russia has set up a legal framework for cryptocurrencies, including a tax structure. Yep, they’ve got their eyes on the crypto game, but they’re still steering clear of it for the fund. They’ve even slapped a personal income tax of 13-15% on crypto transactions.
However, using cryptocurrencies for domestic payments? Not happening. They’re more interested in using them for international trade with countries like China and Turkey. Additionally, the Russian Central Bank retains authority to approve financial decisions, which adds another layer of caution regarding NWF liquidity levels.
But here’s the kicker: if the National Welfare Fund reaches 7-10% of GDP, maybe, just maybe, they’ll think about taking a risk on cryptocurrencies. For now, they’re all about playing it safe.
Compared to other countries that are diving into crypto reserves, Russia’s playing the cautious game. They know the potential for high returns, but the risk? Not so much.
