Sergei Glazyev, the economic adviser of Russian President Vladimir Putin revealed in a recent government meeting that their indigenous cryptocurrency called ‘CryptoRuble’ shall help alleviate the stringency of Western sanctions. No official stance has yet been taken by the Russian government in regards to the issuance of a national cryptocurrency.
CryptoRuble shall serve as a digital currency issued with the backing of the government body which shall gain acceptance as a legal tender. Glazyev feels that a government backed cryptocurrency such as CryptoRublecan aid Russia in circumventing Western sanctions. He was quoted as saying, “a cryptorouble would be a useful tool to get around international sanctions.”
He further added that, “this instrument suits us very well for sensitive activity on behalf of the state. We can settle accounts with our counterparties all over the world with no regard for sanctions.” He divulged the fact that the nascent currency shall be, “the same ruble, but its circulation would be restricted in a certain way,” thus making it possible for Kremlin to keep track of its every single move.
The concept of an independent version of CryptoRuble was proposed last month by Glazyev who suggested using the same for settlement of inter-state transactions. He pointed out that “no mining is possible,” using the cryptocurrency and that:
“It’s just a decision of the authorities to issue a non-cash form of a discrete stream of monetary units… The digital ruble guarantees us full protection – from fraud, from theft…Wherever there is a demand for the targeted use of money, be it government spending, budget investment, the work of banking structures and corporations, it can be applied.”
Also read: Venezuela Reveals Details Of Trading, Mining and Launch of It’s National Cryptocurrency
Russian government seems to be quite involved with the topic of CryptoRuble issuance off late weighing out whether the positivity’s outweigh the loopholes. Russian news agency TASS reported that a meeting conducted on 28th December on legislation of cryptocurrencies in Russia brought together various government officials many of whom took a stand against it. First Deputy Governor of Russia’s Central Bank, Olga Skorobogatova and Deputy Minister of Finance Alexey Moiseev felt that it was absolutely redundant to issue a national crypto.
Olga was quoted as saying that the bank, “does not think this [cryptoruble] is advisable from the point of view of the macroeconomics of the population.”
She had however revealed that the Russian Central bank is considering “a supranational digital currency within the BRICS or the Eurasian Economic Union (EAEC).” She added that The Bank of Russia is a firm believer of the fact that, “the issue of a common cryptocurrency for a number of countries is very promising, more than that for a single nation.” This viewpoint of Skorobogatova was in much contrast to the one presented at the International Economic Forum in St. Petersburg on June 2017 wherein she stated that, “We will definitely get to a virtual national currency, we’ve already started working on it.”
The Russian government had been contemplating about the issuance of a government backed digital token since 2015. Qiwi, a publicly traded Russian payment service provider had incubated the concept of a national cryptocurrency which he had named as ‘BitRuble.’ An official group had been set up in the Russian state of Duma to look after the risks and regulations involved in the world of cryptocurrencies. Past reports had suggested that the Russian government might introduce an outright ban on cryptocurrencies. But its official stance has not taken a specific shape till date.
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Tarunima Ghosh Laha is a Finance Post Grad from St. Xaviers who believes Finance is more than just Balance Sheets and Ledger creation. This filmy bookworm who believes she was a sloth in past life also nourishes a penchant of owning a private zoo someday. Equipped with a laptop and online Lexicon she is all set to give finance a glamorous makeover in the form of exciting writeups with bang on info and flashy new words.
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