Crimea Plans Cryptocurrency Fund to Circumvent Sanctions, Woo Foreign Investors

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Crimean authorities want to launch a cryptocurrency fund for foreign investors to circumvent the economic sanctions currently in place against the Russian-occupied territory. Georgy Muradov, the deputy prime minister of Crimea, revealed his plans on April 18.

“We are discussing these schemes to circumvent sanctions,” Muradov told reporters (via Tass). “One way is the creation of a cryptocurrency investment fund in Crimea where we can accumulate cryptocurrency resources, exchange them into cash, and then use them to implement certain investment projects on Crimean land.”

Muradov added (via Arguments of the Week): “Cryptocurrency is a way to avoid settlements in U.S. dollars and euros from currency restrictions.”

crimea deputy prime minister Georgy Muradov
Georgy Muradov, the Crimean deputy prime minister. (screenshot)

Muradov made the remarks one day before the Yalta International Economic Forum. At the conference, Anatoly Aksakov — who heads the Committee on the Financial Market in Russia’s lower legislative chamber —  said cryptocurrency exchanges and ICOs may be allowed on Crimean territory, but mining won’t be permitted due to electricity shortages in the region.

“Mining in the Crimea is an illusion, but ICO and crypto-exchanges are quite real,” Aksakov said. “[Authorities] are working hard on this issue.”

Bitcoin Bull Wants Crimea To Be Crypto Hub

The move toward cryptocurrency adoption on Crimean territory is definitely progressing.

In April 2017, Russian businessman and bitcoin bull Boris Titov proposed transforming the Eastern European peninsula into a sort of crypto Silicon Valley that could be home to various cryptocurrency and blockchain businesses.

“Maybe we can make a Crypto Valley Crimea,” Titov said, as CCN previously reported.

Crimean peninsula
The Crimean peninsula. (Shutterstock)

Meanwhile, Russia is making bold moves toward cryptocurrency adoption. Gazprombank, the third-largest bank in Russia, will conduct crypto transactions in Switzerland later this year as part of a pilot program through its Swiss subsidiary, as CCN has reported.

Russian regulators are currently drafting cryptocurrency regulations. A final version, which will be released in July 2018, will legalize and set guidelines for initial coin offerings, blockchain technologies, and crypto mining.

While Russian president Vladimir Putin had initially expressed skepticism about bitcoin and the virtual currency market because they are unregulated and not backed by a central bank, he has since softened his stance in recognition of the ballooning market and demand.

In fact, Russia plans to launch its own cryptocurrency called the CryptoRuble, in part to circumvent U.S. economic sanctions.

Featured image from Shutterstock.

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Samantha Chang is a politics writer at BizPac Review and a financial editor. She is a law school graduate and an alum of the University of Pennsylvania. You can follow her on Twitter @Samantha_Chang.