Cryptocurrencies Can Destroy Russian Economy, Says State Official

Posted in: Archive
September 23, 2016 7:30 PM UTC

The deputy general director of Russia’s Federal Financial Monitoring Service has reportedly stated that cryptocurrencies -like bitcoin- threatens the Russian economy and could lead to its destruction.

Paul Livadniy, the deputy director at the Federal Financial Monitoring Service of the Russian Federation, aka Rosfinmonitrong, has warned that the cryptocurrency industry represents a threat to the Russian economy and is capable of bringing about its destruction.

As reported by Russian publication, Livadniy compared cryptocurrencies to traditional currencies, reasoning why the former could bring about the downfall of the country’s economy. Since traditional currencies are issued by the state, Livadniy explained that a they provide greater controls. Such as, adjusting its supply to the market while being aware of balances and the means to fight inflation, the official added.

Noting that cryptocurrency is “obscure” in its origins and as a payment, Livadniy added:

You can consider it as a challenge to the nation’s sovereignty, when there is competition from the influx of a currency equivalent [cryptocurrencies], an equivalent which is not governed nor backed by anything.

Livadniy has previously – and notably – stated that Russia’s infamous bitcoin ban bill, if approved, might have to see a rethink in the future. The official acknowledged the interest surrounding bitcoin and blockchain technology at the time, stating:

[W]e cannot ignore the fact that this tool is developed throughout the world and, perhaps, after a while, we will have to look at this problem from several different angles.

While Livadniy is opposed to unregulated and decentralized cryptocurrencies, the official has previously professed support for a state-controlled cryptocurrency, issued by the Russian Federation.

Earlier this year in May, Livadniy made the revelation that the Central Bank of Russia, the Russian Ministry of Finance (a government agency known for its hardline stance against bitcoin) and representatives from major Russian banks are, through a course of several meetings, discussing the terms and means to issuing state-issued digital currency.

The emission of a Russian cryptocurrency will be entrusted to financial institutions and would require a license besides seeing its regulation. Furthermore, any centralized, state-issued cryptocurrency would immediately outlaw all other cryptocurrencies, such as bitcoin.

 Disclaimer: Translations are unofficial.

Image from Shutterstock.

Last modified: May 21, 2020 10:16 AM UTC

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Samburaj Das @sambdas

Samburaj is the Editor for CCN, among the earliest and foremost publications covering financial and blockchain news. He has authored over 2,000 articles for CCN. Email him samburaj(@) or find him barely tweeting @sambdas