Real Serious Fundamental Problems with Extensive Use of Cryptocurrencies Says Vladimir Putin

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Real Serious Fundamental Problems with Extensive Use of Cryptocurrencies Says Vladimir Putin

For the first time, the Russian President Vladimir Putin has issued his first remarks on cryptocurrencies e.g. Bitcoin/Dogecoin/Litecoin. He was giving his speech on digital currencies in an educational forum broadcast on domestic TV. Looks like it is the first such a statement in public by the head of state of a major economy in the world.

Cryptocurrencies have been making news in Russia for quite some time for various reasons. Various local news papers covered the event extensively and some of them like Gazeta reported that Vladimir Putin indicated his belief that the Bank of Russia, the country’s central bank, has so far taken a reasonable stance on the technology by exploring its applications.

He had also suggested that while he considered the use of digital currency as money to be perhaps problematic, the technology could be best considered as a novel way to calculate transactions. Interestingly, soon after various versions of Vladimir Putin’s statement on the issue started appearing, the official spokesperson had to come to clear the confusion.

Whereas the loose translation of the remarks made by Putin says that there are real serious fundamental problems with extensive use, in any case, today, a spokesperson for the president later specified in a separate announcement that he was speaking broadly about digital currency technology, not specifically Bitcoin.

As soon as the reports about the statement from Putin came to media, some reports that the country’s lawmakers had updated a draft bill aimed at outlawing the use of digital currencies as monetary surrogates also started appearing.

Bitcoin in Russia Has been Facing Tough challenges

From what Putin says about cryptocurrencies it appears the traditional view that Russian legislators and authorities that Bitcoin is disruptive and hence illegal is official stand. Earlier, CNBC had reported that Bitcoin was illegal in Russia in 2014. Various Russian authorities and organizations have spoken out or taken actions against Bitcoin as well.

For instance, earlier this year, Russia’s media regulator blocked several Bitcoin-related websites and a Russian state-owned media outlet reported that according to “the Russian Central Bank Bitcoin usage is illegal under Russian federal law. This was in accordance to the notice issued in 2014 by the Bank of Russia that banned any money substitutes like digital currencies.

To contact the reporter of this story: Deepak Tiwari at deepak@forexminute.com