Russian authorities disagree on cryptocurrency regulation, to focus on blockchain legalization instead

Maria Nikolova

Russian authorities set aside plans for regulating cryptocurrencies and will, for the time being, focus on legalizing blockchain and related technologies.

Any regulation of the cryptocurrency segment in Russia seems more and more distant, with the latest skeptical comments on the topic delivered by Russia’s Deputy Finance Minister Alexey Moiseev.

Mr Moiseev told Russia’s information agency RIA Novosti that the Russian authorities will not be implementing any rules for the cryptocurrencies, although they will continue to monitor the market and the latest developments in this area. The institutions could not reach a unified position regarding cryptocurrency regulation, he said.

Mr Moiseev’s comments echo those made by Elina Sidorenko, who is at the helm of a working group on cryptocurrencies at the State Duma, the lower chamber of the Russian parliament. In August this year, Ms Sidorenko said the bill for regulating Bitcoin and its likes is about to get delayed. She explained that the bill, which was originally poised to be ready in October, will be ready in the winter at the earliest. Ms Sidorenko enlisted several factors for the delay – the need to establish a common position for all institutions involved in the process, as well as the recent Bitcoin price fluctuations, which raise more questions about the vulnerability of cryptocurrencies.

In the meantime, the Central Bank of Russia has returned to its critical stance on Bitcoin and its likes from 2014. Earlier this month, the “Megaregulator” issued a warning regarding the risks associated with cryptocurrencies and initial coin offerings.

Mr Moiseev has explained that whereas the regulators are for the time being setting aside their plans regarding the cryptocurrencies, they will instead focus on the legalization of blockchain. The Russian Duma has allocated RUB 2.5 million for research of blockchain, ICOs and cryptocurrencies.

The advancements of Russia’s business and institutions regarding the adoption of blockchain, however, seem to be modest. This is suggested by the small number of blockchain patent applications – only 17, filed in Russia in the period from 2008 to 2017.

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