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Vladimir Putin Releases Russia’s View on Cryptocurrencies

Vladimir Putin Releases Russia’s View on Cryptocurrencies

In a puzzling commentary, Russian President Vladimir Putin talked about the question of Russia issuing its own digital currency. The sentiment was produced during the live annual question and answer session with Russian citizens on June 7.

A Russian blogger, Artem Khokholikov asked the president three questions about digital currencies through the live session known as “Direct Line.”

“Will Russia have its own cryptocurrency? […] Will it be controlled by the government? […] Do you think that in the near future cryptocurrency will completely replace our regular, standard money?” asked the blogger.

Responding the first question Putin stated that Russia could not produce a fiat virtual currency due to its decentralized nature and a cross-border reach.  He added that crypto mining is not regulated by the government, but it does have a serious outlook towards it.

He dismissed the idea of virtual coins becoming a form of payment. Although Japan is trying to adopt digital tokens as an alternative to money other countries are not so comfortable with it.

Putin added, “The relationship of the Central Bank of the Russian Federation to cryptocurrency [is that] it considers cryptocurrency neither a means of payment nor a store of value. Cryptocurrency is not backed by anything. One should treat it cautiously, carefully.”

The president also said that they should keep an eye on the new technology and figure out ways to use it beneficially. It seems like that he wants to dodge the international financial regulations through digital currencies. His remark can be linked with the ongoing western sanctions imposed on the country.

It was Putin’s 16th “Direct Line” to address issues and events concerning national administration. The format of the live TV allows citizens to ask any question in regard to the country’s policies. Most of the times, the questions are managed beforehand to point out certain objectives of the government. The inclusion of digital currency hints that the technology will be a part of national-level debates and discussion in the upcoming months.

On the other hand, since 2015, crypto media has been making allegations of Russia’s possible move towards launching a fiat digital currency, CryptoRuble. Similarly, the possible launch date was also revealed about the state-owned cryptocurrency in mid-2019. Earlier in January, one of Putin’s advisor said that launch of CryptoRuble would ease the pressure poised by financial sanctions.

In May, Duma, a state in Russia, was on the verge of approving country’s biggest crypto and blockchain related bill, “On Digital Financial Assets.” Recently, it was also reported that Russia is building an association with Iran and Venezuela to form an alternative financial ecosystem. The idea is to minimize the dependence on US and UN sanctions for conducting international trade.

Whereas, president’s latest speech has eliminated all the speculations. It can be safe to say that the biggest country in the world has no intention of indulging in crypto management. Yet, it cannot be denied that Russia can release a virtual coin in future as remarks made by the president did not deny future possibilities.

About the author

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Sady Doyle

Author of “Trainwreck: The Women We Love to Hate, Mock, and Fear… and Why” (Melville House, 2016). Seen at Elle, In These Times, and all across the Internet.

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