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    Tech and political executives denounce Russian crypto ban proposal

    Tech and political executives denounce Russian crypto ban proposal

     

    The recent crypto ban in Russia has drawn criticism from a series of big names, that include Alexei Navalny’s Chief of Staff, Leonid Volkov, and the messaging app Telegram’s Founder, Pavel Durov.

     

    On January 20, the Russian Central Bank had published a report that proposed a blanket ban on all domestic crypto trading and mining. The report had stated that the risks of crypto had become “much higher for emerging markets”, Russia included.

     

    It appears that the current ban on crypto hasn’t yet been universally accepted in the country. In a January 22 post by the messaging app, Telegram’s Founder, Pavel Durov, had stated that the ban on cryptocurrencies can destroy several other sectors of the “high-tech economy.” 

     

    Durov further noted that such a ban would “inevitably slow down” the overall development of blockchain technologies and other technologies that improve the efficiency as well as safety of several human activities ranging “from finance to the arts.”

     

    Although Durov conceded that the “desire” of regulating the circulation of cryptocurrencies comes as a “natural” tendency on the part of any “financial authority,” he has concluded that such a blanket ban is unlikely stopping “unscrupulous players”, but it might put an end to Russian legal projects in the arena.

     

    Through a Telegram post on January 20, Volkov, the Chief of Staff for Alexei Navalny, has also written that the ban sounds like “calling a spade a spade.”

     

    Navalny is a Russian opposition leader and Founder of The Anti-Corruption Foundation (FBK). In August 2020, he had been poisoned with the nerve agent Novichok. After he had recovered in Germany, he returned to Russia in January 2021. He was arrested soon after and has been confined to imprisonment since.

     

    In the announcement, Volkov has referenced a January 20 report by Bloomberg where he claimed that Russia’s Federal Security Service (FSB) had been instrumental in advancing the ban because cryptocurrencies are largely used in financing “non-systemic opposition and extremist organizations.”

     

    Volkov further went on, adding that the Bloomberg version, in that case, had been 100 per cent close to reality, but “nothing will happen” since Russians are more likely of using crypto for buying drugs rather than donating it to the Moscow-based non-profit FBK.

     

    He said that technically speaking, banning cryptocurrency would be the same thing as banning person-to-person transfers, which is impossible. What they can do is make it very difficult, along with processes like depositing funds on crypto exchanges, and transaction costs can rise, but that would be all.

     

    Several neighbouring countries of Russia have also taken a hard-line stance on cryptocurrencies lately. On January 19, citizens from Georgia had been made to swear an oath to make them cease mining cryptocurrencies. The governments of Kosovo and Kazakhstan have also simuatnesuoly banned crypto mining activities, thus featuring among the list of countries that have done so.

     

    The only exception is Ukraine, Russia’s neighbour that had passed a number of laws facilitating the adoption of crypto in September 2021.

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