The Russian Ministry of Finance is taking a hard stance against Russian adopters of bitcoin and cryptocurrencies, with a proposal that –while not yet legal or enforced—aims to punish users engaging in Bitcoin trading with a prison sentence of up to 4 years. While most…
The Russian Ministry of Finance is taking a hard stance against Russian adopters of bitcoin and cryptocurrencies, with a proposal that –while not yet legal or enforced—aims to punish users engaging in Bitcoin trading with a prison sentence of up to 4 years.
While most governing bodies around the world looks to adopt bitcoin or block chain technology or look for ways to regulate the cryptocurrency, Russia is unrelenting in its stance toward what it sees as the “trafficking” of Bitcoin.
The Russian Ministry of Finance that had previously supported fines of up to 500,000 rubles or a 2-year community service sentence is now pressing ahead for a 4-year
Notably, the proposal for this ‘revision’ to the law from the Russian Finance Ministry has found an influential supporter – the Ministry of Economic Development in Russia, reports Russian finance publication Vesti.
Russian has had a volatile past with Bitcoin and the legality of cryptocurrencies in general. Last year, the Central Bank of Russia made the decision to take a “careful approach to bitcoin” and “monitoring the situation (of the adoption of Bitcoin) with the Bank for International Settlements,” from a distance.
While the announcement was taken as a new Russian attitude towards the cryptocurrency, plans were being drawn to ban Bitcoin by the end of the same year. Taking a cue from Bolivia and Ecuador, Russia also sought to ban Bitcoin in an official capacity in 2015.
The latest proposal to send Bitcoin adopters to prison comes with the same narrative that has long been the official line drawn by government officials opposing the cryptocurrency. Speaking to Izvestiya, a prominent broadsheet newspaper in Russia, Assistant Minister of Economic Development Elena Lashkina said:
Operations on them [Bitcoin] are speculative in nature, are carried out at so-called virtual exchanges and carry a high risk of changes in its value.
The use of surrogates, including cryptocurrency, is associated with a high level of risk.
The anonymous nature of the production of money substitutes, including cryptocurrency, [brings with it an] unlimited range of [threat] actors to create the conditions for the involvement of citizens and companies in illegal activity, including the laundering of proceeds from crime and terrorist financing.
There is speculation among industry experts that the proposal to serve prison sentences to users of bitcoin serves as a deterrent to favor local Russian cryptocurrencies instead. The Ruble is still faring weakly against the U.S. Dollar, and there are sanctions from the West.
In the meantime, a cryptocurrency concept named ‘Bit-Ruble,’ has been announced by Russian payment processor Qiwi and is scheduled to launch in 2016. Government officials who view the Central Bank as the only authority to emit money in Russia, are wary.
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Last modified: May 21, 2020 10:59 AM UTC