VTB head Andrei Kostin has once again reaffirmed his positive assessment of digital currencies, but with an important caveat: the future belongs to state-issued digital assets, while private cryptocurrencies inevitably face resistance from global regulators. This statement, made at the Eastern Economic Forum, reveals a deep-seated conflict between decentralized finance and the traditional monetary system.
Speaking at the session "Betting on Youth: What Can Business and Government Learn from Zoomers?", Kostin explained why non-state cryptocurrencies undermine the fundamental foundations of monetary policy. Central banks and financial authorities operate with tools such as money supply aggregates M1 and M2, as well as key interest rates. The parallel existence of an unregulated market that does not respond to these levers poses a direct threat to their control over the economy.
Predictions of Banks' Demise Have Not Come True
Interestingly, Kostin also takes a jab at the long-standing predictions about the imminent demise of the traditional financial system. He recalls that two decades ago, experts in Silicon Valley predicted that blockchain would render banks obsolete. However, reality has proven otherwise: banks have not only survived but continue to play a key role in settlements, and cash is even regaining popularity.
This skeptical stance explains the strategy of the largest players. Instead of fighting cryptocurrencies, banks prefer to integrate them into their own infrastructure. Major Russian banks have already prepared the technical foundation for cross-border cryptocurrency settlements. According to estimates from Alfa-Bank's top executives, competition for this market will be extremely fierce, with miners and importers—who are already actively working with digital assets—becoming the first clients.
Examples from Russia and Around the World
The story of the ruble stablecoin A7A5, backed by the state-owned Promsvyazbank, is telling. Despite a transaction volume exceeding $100 billion, the Bank of Russia has never mentioned this token in its documents on stablecoins. Experts attribute this silence to the protection of the digital ruble and a reluctance to cede control over ruble issuance to a semi-private structure.
Similar processes are unfolding abroad. A coalition of 39 U.S. banking associations has announced the creation of the BankChain Alliance—an industry blockchain network for stablecoins and tokenized deposits—which 3,283 banks with $21.8 trillion in assets plan to launch in 2027.
However, regulators are in no hurry to change their approaches. A recent experiment by the Central Bank of Italy showed that USDC transfers across ten routes cost between 0.3% and 9%, meaning stablecoins have yet to demonstrate a consistent advantage over traditional channels.
My conclusion: the regulators' fight against private cryptocurrencies is not a war on technology, but a struggle for sovereignty in financial policy. Until decentralized assets prove their effectiveness on a mass scale, central banks will continue to strengthen their own digital projects, creating a hybrid system where cryptocurrency exists only under their control.