In contrast with China, which has just banned ICOs, the Russian government plans to regulate cryptocurrencies like securities, Finance Minister Anton Siluanov told reporters on Friday last week.
These statement marks a full reversal from his ministry’s proposal last year to punish people who use digital currencies with up to seven years in jail, notes Bloomberg.
Contradictory signals, however, are still delivered by various Russian officials and authorities. In late August Russia’s deputy minister of finance Alexey Moiseev claimed bitcoin is akin to a high-risk “financial pyramid,” hence requiring tight regulation.
On Sept. 4, the central bank issued a public notice on the risks associated with cryptocurrencies and ICOs. “Cryptocurrencies are issued by an unlimited number of anonymous entities. Hence, citizens and legal entities can get involved in illegal operations, including laundering of illegal income and terrorism financing,” the notice reads.
The central bank sees “high risks” in operations involving cryptocurrencies, including their issuance, circulation, exchange and fundraising through ICOs. “Meanwhile, virtual currencies holders can have issues with ownership rights. All this can cause citizens lose their money, while their rights as consumers of financial services will be impossible to protect.”
“In view of the high risks of cryptocurrencies circulation and use, the Bank of Russia considers it premature to admit cryptocurrencies [and related financial instruments] to circulate or be used to service transactions […] in organized trades, in the clearing and settlement infrastructures” on Russian territory.
Neither forbidden nor allowed
“Currently, from a legal standpoint, transactions using cryptocurrencies are forbidden to legal entities, but they are neither allowed nor forbidden to individuals,” notes Blockchain and ICO expert Arseniy Strizhenok.
“While certain institutions try to make steps to authorize cryptocurrencies, some others do everything they can to ban or restrict them,” he told East West Digital News. “And this is only creating confusion.”
Thus recently the central bank registered Voskhod, a cryptocurrency investment platform backed by such institutions as the state-owned Fund for the Development of the Far-East, the NTS financial market association, and Skolkovo, the giant government-sponsored tech hub on the outskirts of Moscow.
“Even though these registration documents formally allow us to trade electronic assets, the regulator calls such operations ‘premature’ in its press release. We will postpone [launch] until the central bank will consider them as being timely,” stated Roman Goryunov, president of the NTS association, at the Eastern Economic Forum last week.
“The majority of the world’s projects in the field of digital money have been made essentially by people with Russian origins,” Alexander Ruchev of the Osnova group stated yesterday, perhaps with some exaggeration, at an industry conference hosted by the Plekhanov university of economics.
“But today, due to the absence of state regulation and Russian-made hardware, our country is not among the world leaders in Blockchain development and implementation in bank and exchange systems. And talented Russian entrepreneurs have to launch major ICOs abroad,” Ruchev complained.
This story also appeared in VentureBeat, a syndication partner of East-West Digital News.
