Russia Is Becoming Serious About Blockchain but Remains on the Fence About Cryptocurrencies

Last week in St. Petersburg, an annual forum was held that brought together the largest number of Russian personalities in the economic sector. Cryptocurrencies have made a topic of shine. Namely, government agents and state-controlled companies clearly showed interest in blockchain, but appear to be distinguished from digital chips.


Meanwhile, the country still lacks the regulatory framework for cryptocurrencies, even though the local authorities are in charge of preparing some necessary changes some time ago. So where is Russia moving in terms of cryptocurrency and blockchains?

A brief introduction to Russia’s relationship with cryptocurrencies

Russia's position on the currency crypto is mixed and fluid, indicating how the CryptoRuble project - a national stabilization project in the local currency took place. First, financial intermediary Pavel Medvedev described the use of substitution for the conventional currency as "illegal." The Kremlin would then decide that a stable domestic animal "can reduce the number of anonymous transactions" or even help avoid Western sanctions, giving the green light to the project. However, CryptoRuble has finally dropped into the background, as the current state of the project is unclear. This was last mentioned in the news in January 2019, when the government official said it could be released "for 2-3 years", although the Central Bank of Russia (CBR) acts "very cautiously" about this idea.

Cryptocurrencies are generally found in a similar situation. In October 2017, President Vladimir Putin said cryptocurrencies "include serious risks" and was used for criminal purposes, citing CBR's decision to block sites selling digital assets. A month earlier, Russian Finance Minister Anton Siluanov said authorities must accept the idea of ​​a digital money market:

 "There is no point in banning them; it is necessary to regulate them."

Since then, many attempts have been made to define the cryptocurrencies legally. President Putin (twice), the Supreme Local Arbitration Tribunal, and the Financial Action Task Force have called on Russian lawmakers to establish a regulatory framework.


In May 2018, the draft of the cryptocurrency bill - called "Digital Financial Resources" (DFA) - was adopted by the Russian parliament, but quickly returned to the first reading due to the lack of definition of key terms such as crypto extraction, cryptocurrency, and tokens.

Last month, Prime Minister Dmitry Medvedev said the popularity of the cryptokura was "reduced", and the issue of regulation was "no longer relevant". It is significant that one year ago he invited the government to bring at least some basic cryptography provisions.

The current deadline for Putin's regulatory framework expires in July.

Recap of SPIEF, a yearly Russian business event for the economic sector

Binance and Huobi reported on the influx of retailers, Vitalik Buterin talked about Ethereum 2.0
Although the prime minister has indicated that the popularity of the cryptocurrency has diminished, they are often discussed at the International Economic Forum in St. Petersburg (SPIEF), the annual economic event devoted to the economic sector in Russia, will be held from 6 to 8 June.

On a panel called "Blockchain Technology and Crossword: Past, Present, Future," Vitalik Buterin, co-founder of Ethereum; Chris Lee, CFO in Huoba; Ted Lin, growth manager at Binance; and Kevin Shao, among others, were on the list of experts.

Lin and Lee reported on the influx of "new generation" retailers into their platforms due to recent market growth. According to them, the trend will soon remain.

Buterin, in turn, talked about Ethereum 2.0, also called Serenity - the main update that Ethereum should do 1000 times scalable for 18 to 24 months.

The Bank of Russia stated that cryptocurrencies are not part of the traditional financial sector

Sergey Shvetsov, the first deputy governor of CBR, allegedly compared the "play" crypto crypt while finishing in the SPIEF. He allegedly said:

"If we are talking about crypts and currency clubs, it's not a financial market; it's just a game. Some people like to play, invest in it [cryptocurrency], but the consequences will affect others, so here's a pretty strict policy.

The CBR once again emphasized its skeptical position about the currency crypto. Last month, Elvira Nabiullin, the director of the Russian bank, said his agency was opposed to the idea that cryptography became a substitute for fiat money.

The Russian official suggested creating a special economic zone for cryptocurrencies

Leonid Petukhov, the head of the Far East Investment including Export Agency, proposed creating an offshore destination for cryptocurrencies on the Bolshoi Ussuriysky island, which extends on the border with China. He told TASS, a Russian news media:

"We want to create a big financial center." Metaphorically speaking, this would include cryptocurrencies, crypto-currency exchanges, timber trading platforms - like the domestic offshore, in the good sense of the word. "What we did in Kaliningrad.

Petukhov probably referred to Oktyabrsky Island in the Kaliningrad region, which along with the Russky Island in Vladivostok in 2018 became an offshore economic zone. Companies that register in these clusters are exempt from certain fees - for example, they do not pay tax dividends. However, none of these areas currently provides benefits for cryptocurrencies.

Russia's largest bank leader said that Bitcoin is for transactions, not for investment - he plans to put on a blockchain
Herman Gref, executive director of Sberbank, said he believes Bitcoin is a "technical instrument of the transaction", not a type of investment. He also commented on his own experience in investing in cryptography, revealing that he bought Bitcoin when it was worth about $ 5 and used it for payment instead of keeping the coins.

Also, Greg said his bank will not develop cryptographic services but will focus on tools that support blockchain. As the CEO said, the hype crypto market has disappeared, but "the usual work with blockchain technology has remained," making it "happy."

Nornickel is an IBM partner to organize blockchain academic programs

Nornickel, the earth's largest nickel and palladium producer, signed a partnership alliance with IBM also with Moscow Institute of Physics and Technology at the forum.
This partnership will establish an educational center that will offer block-course programs for graduate students as well as for students of doctoral studies. Students.

"Students and postgraduate students will learn how to apply blockchain technology and gain knowledge of trading cryptocurrencies, stable coins, tokenization platforms, and similar services," the participants said — press release.

Also, President Nornickel Vladimir Potanin argued that symbolization could make trade easier, cheaper, and more transparent. Earlier in March, he presented his company's plan to create currency cryptographic crypto support. These chips should be used for trading palladium-based palladium-based bases in Switzerland as well as several other digital platforms.

Blockchain's private enterprise and government platform launches its mainstream network
The main network The Vostok platform based on the channel chain was launched in SPIEF. The main network would be used to validate transactions, while Vostok customers, represented by large Russian companies and government agencies, can also create their nodes and use private subnets.

As Cointelegraph reported last month, the Russian city of Nizhny Novgorod began testing the use of the "City N" application, launched by Vostok, which would allow residents to file their taxes and verify their identity, among other things.

The main Russian oil company said that part of Facebook could use to buy oil in the future
Igor Sechin, leader of the Russian oil company Rosneft, spoke of the potential relationship between crude oil and crustaceans. In particular, the possibility of paying oil through digital assets in the future "should not be excluded."

According to Sechin, technological giants from Silicon Valley, such as Google, Amazon, and Apple, are beginning to explore the oil and gas sectors. That's why one day Facebook account could be used to buy oil per barrel.

Also, Sechin warned that cryptocurrencies must overcome some obstacles to attract the attention of energy giants. He quoted as follows:

"Greater flexibility often means greater volatility and digitization that creates the risks of maintaining business secrets and leads to the need to develop new regulatory mechanisms, additional reserves. Today, technology companies do not have good quality answers to these fundamental issues. "

The Russian government continues its research on blockchain but remains cold on digital media
At the same time, the Russian government is still considering strict regulation for cryptocurrency. Recently, one representative of the Russian parliament stated that officials considered imposing administrative responsibility for exploiting the cryptocurrencies.

"We think the cryptocurrencies are created on open chains such as battlefields, ethers and other illegitimate tools," TASS Anatoly Aksakov, chairman of the Dume Financial Committee, told TASS.

But things are much more optimistic about the front of the block. This week, Russian authorities have signed an agreement with Danish Danish logistics company Maersk to launch the TradeLens platform for delivery of blocking ships - all over Russia to digitize transport paper. Earlier last month, Russian National Conglomerate Rostec proposed an ambitious plan for applying blockchain in all state data systems, suggesting that Russia's intentions about technology become more and more important seriously.




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