Monday, October 16, 2017

Bitcoin not allowed: Business leaders in Russia appeal to government for integration of domestic cryptocurrencies only

Last week, Russia announced they were well on the way towards creating a new sovereign cryptocurrency... the CryptoRuble, and included in this were comments made by the Russian central bank debasing the attributes of de-centralized cryptos such as bitcoin.

Speaking at a separate conference in Moscow, Sergei Shvetsov, the first deputy governor of Russia’s central bank, said investors needed to be protected from “dubious” currencies. “We cannot give direct and easy access to such dubious instruments for retail (investors),” Shvetsov said, according to Reuters
Shvetsov compared the high risk of bitcoin to a pyramid scheme. 
“We see bitcoin gradually turning into an asset acquired for the purpose of obtaining a high yield in a short period of time, meaning it has signs of a financial pyramid,” Shvetsov said, according to the Russian news agency Tass. - Marketwatch
However, President Putin and his administration recognize the inevitability of the Blockchain and the need to get his financial system onto this platform while at the same time getting ahead of the game as de-centralized cryptocurrencies threaten sovereign authority.  And on Oct. 16 it appears that business leaders in Russia recognize this as well and are calling for the government to ban all non-domestic cryptocurrencies.

Graphic courtesy of Bitcoin News
A Russian business group has asked parliament to legalize the circulation of domestic cryptocurrencies only, pointing to the risks of foreign virtual money. The warning came amid an increased number of proposals from Russian officials to introduce government control over cryptocurrencies. 
"In the current geopolitical situation, the issuance and circulation of foreign cryptocurrencies in Russia risks irreversible negative consequences for both Russia’s economic development and political stability," AVANTI, a patriotic entrepreneur association, said in a letter to the speakers of both chambers of the Russian parliament.In particular, the business group is urging the parliament to consider legal amendments concerning government regulation on the issuance and circulation of cryptocurrencies. 
What Are the Risks? 
The letter pointed out the key risks possibly stemming from cryptocurrencies. 
"In addition to a number of undisputable advantages, any cryptocurrency has its flaws from which serious risks emerge. Among these disadvantages are the lack of control over issuing and circulation, exchange rate unpredictability, insufficient security, anonymity and decentralization," Rakhman Yansukov, chairman of the business association, said. Sputnik News

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