At the Crypto Regulation Vanguard, Russia Looks to Bring Crypto Into Use On Its Own Terms
Just a little over two weeks ago, the crypto space held its breath as rumors swirled around regarding whether Russia would follow China’s lead in de-licensing crypto exchanges, banning ICOs, and so forth.
However, in the ensuing days, a flurry of pro-crypto news has burst out of Russia, showing that while the international rogue might be at the back of the pack when it comes to global politics, it’s now at the front of the line when it comes to nations who are seriously looking at crypto to revolutionize fintech.
The rest of the world would be wise to catch up. In the meantime, though, let’s bring you up to speed on all the important regulatory developments coming out of Mother Russia.
Regulatory Framework is announced
Crypto-enthusiasts gave a collective sigh of relief in the middle of October when it was first announced that the Russian government would officially start regulating cryptocurrencies.
Before this, there was considerable doubt in the community that top Russian leadership would move toward regulating, not banning, crypto.
Indeed, after Russian president Vladimir Putin met with a cabal of domestic central bank officials, it was decided that regulation would be given the green light.
Russian Finance Minister Anton Siluanov described the results of the meeting:
We have agreed on the following: the state should regulate the process of issuing cryptocurrencies, the process of mining, the process of circulation … The state should head this situation and regulate it legally.
Creation of Cryptoruble set to go ahead
Once Russia’s regulatory framework was announced, further news trickled out quickly. One of the most notable revelations was the impending creation of the “cryptoruble,” a digitized cryptocurrency version of Russia’s fiat currency, the ruble.
During a closed-door business conference in Moscow, Nikolay Nikiforov—Russian Minister of Communications and Mass Media—admitted that Putin had begun to organize the creation of the cryptoruble:
I so confidently declare that we will launch a cryptocurrency for one simple reason: If we do not, then in 2 months, our neighbors in the Eurasian Economic Community will do it
Nikiforov specifically said the new cryptoruble would be designed to “streamline the payment of personal income tax.”
Regulators hone in on crypto miners
Russian regulators haven’t forgot about crypto miners, either, as they’re wanting to bring the practice into the regulatory daylight, so to speak, so that the practice can be fully taxed.
The plan, per Committee on Financial Markets director Anatoly Aksakov, is to tax Russian crypto miners based on electrical consumption:
If we talk about mining, then this is a large consumption of electricity, it is obvious that it is not difficult to track. I do not see any problems here.
Crypto detective agency
A top Russian legislative body has proposed the creation of a “crypto-detective agency.”
According to the State Duma Financial Market Committee, the agency would be tasked with researching ICOs and other enterprises in the space as a means to protect Russian investors from malicious, fraudulent activities.
This glorified research group will undoubtedly materialize over the next few months.
Big Business in Russia demands only national cryptocurrencies
A major Russian business group—The Association of Entrepreneurs for the Development of Business Patriotism—is now lobbying the Russian federal government to only allow domestic cryptocurrencies in Russia.
This group sees foreign cryptocurrencies as destabilizing forces within Russia. They propose that only Russian-made crypto ventures should be allowed to freely operate within the nation.
Officials in the State Duma noted their skepticism regarding whether separating foreign from domestic cryptocurrencies would even be technically possible.
More news to come
Amazingly, all these headlines have occurred within the span of just two weeks.
The future of crypto is exciting in Russia, but it’s clear the Russian government is going to engage with blockchain technology and the space around it on their own terms.
Look for other nations to play catch-up while Russia continues to be a regulatory trendsetter in the field of cryptocurrencies.
Images via Fotolia and NBC news
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.