Why is digital currency so difficult in Russia? Issuing it will result in a 7-year prison sentence?

Russia’s Finance Ministry has proposed tightening penalties for so-called currency substitutes, including digital currencies.

Interfax news agency reported that according to an unnamed informant within the Russian government, individuals who issue currency substitutes will face a four-year prison sentence, and if a financial company issues currency substitutes, the company's directors may be imprisoned for up to seven years and will also be restricted from holding similar positions in the future.

According to Interfax, the fine for issuing currency substitutes will be between 500,000 rubles and 1 million rubles, or $7,000 to $14,000. The head of a financial company could be fined up to 2.5 million rubles, or about $35,000.

The report comes as Russia is in the process of legislating on digital currencies. If the law is passed, all activities involving non-government-issued currencies such as currency substitutes, including Bitcoin, will be regulated. Russia has been working to bring currency substitutes under formal regulation since 2014.

In February of this year, an adviser to Russian President Vladimir Putin publicly stated that accepting Bitcoin would be considered a criminal act.

But at least one private company, payments company QIWI, is moving forward with its plans for a digital currency called the RitRuble. The company recently said it is developing the project and is working with regulators, including the Russian Central Bank, which has expressed interest in the technology underlying bitcoin in the past.

However, QIWI's RitRuble plans have already irritated some officials in the Russian government, and there are signs that some officials are still opposed to the project.

QIWI communications director Konstantin Koltsov told CoinDesk this week:

“The project is very helpful to our national market, but there are still misunderstandings on technical and regulatory issues”

Original article: http://www.coindesk.com/report-russia-to-propose-7-year-prison-sentences-for-digital-currency-issuers/
By Stan Higgins
Compiled by: Kyle
Source (translation): Babbitt Information (http://www.8btc.com/russia-7-year-prison-sentences)