Russian social network VKontakte allows cryptocurrency advertising

Russia’s social network VKontakte (VK) is allowing the advertising of cryptocurrencies, effective August 8, 2017. The announcement was made by the social network yesterday.

The network now permits the advertising of cryptocurrency exchanges, blockchain services, training platforms, as well as media, startups and businesses involved in cryptocurrency mining and Bitcoin.

There are some requirements: the services and entities advertised should not be banned in Russia. Also, the advertising of cryptocurrencies should be responsible, with no empty promises and fake guarantees allowed. Advertising including promises of “fast and passive returns”, easy fortune and suspicious success stories will not be permitted on the network.

The announcement comes as Russian businesses and even the Russian authorities are warming up to the world of blockchain and cryptocurrencies. The Ministry of Telecom and Mass Communications expects that the implementation of legal provisions for distributed ledger technologies (such as blockchain) will happen not later than in 2019. And although blockchain is not yet regulated in Russia, this technology is not banned.

The Bank of Russia has markedly softened its stance regarding blockchain and cryptocurrencies too. Back in 2014, the Russian “megaregulator” issued a warning against Bitcoin and its likes. This stance, however, has markedly change and numerous Central Bank officials have reiterated that the regulator has never effectively banned cryptocurrencies. In fact, the Bank of Russia is reported to be working on the development of a national virtual currency.

Given this, there seem to be little restrictions on the advertising of cryptocurrencies, Bitcoin exchanges, blockchain products, etc.

Let’s note, however, that concerns have been rising of the growing number of fraudulent schemes involving cryptocurrencies in Russia. One of the reasons for this trend is the lack of regulation of cryptocurrencies. Another reason is the low level of public knowledge concerning this market segment.

A recent survey conducted by the NAFI analytical center among 1,600 respondents across 42 Russian regions, has shown only 28% of those surveyed are somewhat informed about crypto currencies. The percentage of those who heard the term “crypto currency” for the first time thanks to the survey is 72%.

Among those knowledgeable of crypto currencies, 38% think that this is a good investment. Nearly half of those who are familiar with crypto currencies believe that this is a temporary phenomenon.