Putin wants to regulate cryptocurrency as to "protect citizens"

Putin wants to regulate cryptocurrency as to "protect citizens"

According to Putin, this is essential to protect the interests of citizens and business.⁠

Cryptocurrency spreading carries serious risks, therefore the state should control its emission and circulation. This conclusion, according to Head of the Ministry of Finance Anton Siluanov, was reached at yesterday's meeting with President Vladimir Putin, Kommersant reports.

According to the President's speech, reported by Interfax, problems with free circulation of cryptocurrencies are primarily related to the possibility of laundering criminally obtained capital, evading taxes, spreading fraudulent schemes and even "financing terrorism".

The drawbacks also included the fact that cryptocurrencies can be issued by any anonymous subject and that they are not secured with anything. Hence, according to the head of state, in case of financial difficulties, it will be impossible to identify a legally responsible entity.

As Siluanov said, it was decided to draft and adopt laws that will be able to regulate the circulation of cryptocurrencies and mining (roughly speaking, their production). "The state should be in charge of this situation and regulate it," the Minister said.

At the same time, Putin, as RBC writes, stated at the same meeting that it was important "not to build up unnecessary barriers" and to take advantage of the new technological solutions in the banking sector. Probably this is not about the cryptocurrency itself, but about blockchain system on which it is based. Putin also spoke about the need to create conditions for further development and improvement of the national financial system.

It is noteworthy that earlier that day the report of first Deputy Chairman of the Central Bank Sergei Shvetsov appeared, which read that the Bank of Russia together with the Prosecutor General's Office were working on shutting down the websites allowing to purchase cryptocurrency. He compared crypto-currency with the financial pyramid and stated that "for our citizens" and businesses, its use carried unreasonably high risks.

Earlier the same position was expressed by Head of the Central Bank Elvira Nabiullina. And the Minister of Economic Development Maxim Oreshkin compared one of the most popular crypto-currencies – bitcoins – with MMM and urged Russians to be cautious about investing in them. And the Head of the Investigative Committee, Alexander Bastrykin, in early 2016 even announced the possible introduction of criminal liability for the use of bitcoins.

The CrimeRussia has already made the assumption that Russia will create a sovereign cryptocurrency, designed to replace the world's alternatives. Consequently, its issuer and regulator, in contrast to the current anonymous creators, will be the state. It is not a coincidence that this summer the St. Petersburg Economic Forum saw Putin meeting with the creator of cryptocurrency Ethereum, Russian-born Canadian Vitalik Buterin. His platform, based on blockchain technology, also allows using it in the banking system, which could offer advantages to domestic financial structures without losing control over customers.

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