The Deputy Chairman of the Bank of Russia called cryptocurrencies a financial pyramid and urged Russian investors not to invest their savings in them.

Although cryptocurrencies are used as a means of payment, they are a financial pyramid, said Sergey Shvetsov, First Deputy Chairman of the Bank of Russia.

“Cryptocurrency combines two features. On the one hand, cryptocurrency is used as a means of payment. On the other hand, it is a high-tech financial pyramid. Naturally, I do not recommend anyone to invest in something that does not bear any obligations,” said Shvetsov during a live broadcast on the regulator’s social networks.

According to Shvetsov, the main demand for cryptocurrencies as a means of payment comes from those who want to circumvent "certain regulatory restrictions."

“But this phenomenon is temporary, all regulators agree that restrictions should not be bypassed like that.”

He recalled the position of the Russian Central Bank regarding the legalization of cryptocurrencies.

“We consider cryptocurrency as a high-tech pyramid and are not going to facilitate the acquisition of cryptocurrencies by our citizens, especially for investment purposes.”

Shvetsov already made a similar statement. In 2018, he said during a speech at the Financial Solutions Fair:

“If we are talking about bitcoin, then I have a question: what is behind it? If it costs nothing, then we relate to it that it’s some kind of bullshit that is sold to the population under the sauce of innovations... 2% of bitcoin holders today own, in my opinion, 98% of bitcoin, respectively. In order to cash out, they need to make this thing popular. This is how we treat it: a financial pyramid with a good technological core.”