Will Bitcoin be legalized in Russia in 2016?

Author: ManjiMasha

The deputy chairman of the Russian State Duma Committee said that the lower house of the Russian Legislative Council recently expressed its views on virtual currencies. The deputy chairman made interesting remarks on Russia's tough stance on the legalization of Bitcoin in the past and in the future.

Andrei Lugovoi, deputy chairman of the State Duma Committee on Security and Anti-Corruption, said Russia ranks fifth in the world in terms of the number of people using virtual currencies for transactions.

Experts estimate that there are about 200,000 users in Russia using Bitcoin and other forms of virtual currency. In the list of "number of virtual currency users", the United States ranks first with 1.2 million users, and China ranks second with 355,000 users.

Andrei distinguished between those who are negative and positive about virtual currencies in Russia, especially the Central Bank of Russia. Those who call for a ban on virtual currency transactions are mainly worried that it will be used for crimes, while on the other hand, those who support this technology and Bitcoin also call for the intervention of the government.

Andrei Lugovoi said:

At the beginning of 2014, the Central Bank of Russia expressed a negative attitude towards virtual currencies... In the summer of the same year, it announced that the Central Bank would approach Bitcoin with caution and saw possible economic growth in Bitcoin.

The vice chairman said that Bitcoin has developed significantly in Russia, citing a series of events that took place in 2016. He added:

In early 2016, after several meetings between financial institutions and businesses, the central bank is likely to start legalizing Bitcoin and regulating related transactions, especially person-to-person transactions.

This can be seen as a significant turning point for Bitcoin in the country, as Bitcoin trading was originally considered a “criminal matter” by Russian authorities and required prison time.

In the past, Russian regulators and ministers have always taken a tough stance on Bitcoin. Starting from the beginning of this month, the Russian Ministry of Finance has imposed a two-year prison sentence on Bitcoin users; in January, the website of the European Bitcoin exchange BTC-E was also closed by Russian regulators. Also in January, the Chairman of the Russian Investigative Committee said that Bitcoin is a "real threat" to the stability of the Russian economy. He said that the further spread of virtual currencies should be prevented in its initial stages before they become popular.

However, Russia has also been embracing virtual currencies, and controversy has arisen in the country. Russia’s business magazine Vedomosti once published an article urging the country to start accepting Bitcoin, rather than banning it. As a form of blockchain technology, Russia’s Minister of Information recently stated that “it is necessary to explore the uses of blockchain in the best interests of the general public.”

JPM compiled from
Crypto Coins News, Is 2016 the Year Russia Legalizes Bitcoin?, by Samburaj Das.