The Russian central bank has decided to tap into AI to curb illegal crypto activities.
According to official reports, released on December 25th a new artificial intelligence (AI) platform will be introduced by Russia’s central bank to combat illicit financial and cryptocurrency operations, including unregulated crypto-to-fiat over-the-counter (OTC) transactions.
The new step comes against the backdrop of Russia trying to ease up crypto markets to be neck to neck with its global peers but at the same time ensuring to regulate and keep a watch on the sector.
Central Bank of Russia to Use AI To Stop Illegal Crypto Activities
In order to avoid the misuse of banking systems, this activity entails cooperation with Rosfinmonitoring and other financial organizations to track and block suspicious transactions.
The software will concentrate on identifying “Mules” or “Droppers” who use bank accounts for illicit activities like as drug trafficking, money laundering, and unlicensed cryptocurrency exchanges.
The measure also comes against the backdrop of stolen money via crypto seeing a rise in 2024. As Unocrypto reported earlier, over the past ten years, four consecutive years have seen the theft of over $1 billion worth of Bitcoin, indicating that crypto hacking remains a significant problem.
The number of hacking incidents increased from 282 in 2023 to 303 in 2024, and the total amount of money taken increased by roughly 21.07% year-over-year (YoY) to $2.2 billion.
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Russia Takes Bitter Sweet Stand on Crypto Sector
Russia is attempting to open up cryptocurrency markets to catch up to its international counterparts, but it is also making sure to control and monitor the industry.
A good example of this is Vladimir Putin, the president of Russia, approving a new law that will acknowledge Bitcoin and cryptocurrency as property.
However, on the other hand, Russia has announced a broad cryptocurrency mining ban that will take effect in ten districts beginning January 1, 2025, marking a significant regulatory step.
North Ossetia, Kabardino-Balkaria, Dagestan, Karachay-Cherkessia, Ingushetia, Chechnya, the Donetsk and Luhansk People’s Republics, as well as the Zaporizhia and Kherson areas, are all included in the TASS-announced prohibition, which will be in force until March 15, 2031.
Russia Set to See A Rise in Crypto Adoption
The decision to take help of AI to curb illegal crypto activity also comes at a time when Russia is expected to see a rise in crypto userbase.
In particular, it is anticipated that by 2025, there will be 24.59 million users in Russia’s cryptocurrency industry.
The percentage of the population that uses cryptocurrencies, known as the user penetration rate, is predicted to be 16.99% in 2024 and rise to 17.13% by 2025.
As investors look for other financial prospects, Russia is seeing an increase in interest in cryptocurrencies despite regulatory difficulties.
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