By the end of 2017, Russia announced to block its citizen’s access to cryptocurrency exchange website. The decision was temporary but it indicated that the country was not in the favor of cryptocurrencies. But recently, the news came that shows that the decision was only against other cryptos. Russian President Vladimir Putin has asked its governments officials to develop a cryptocurrency for Russia called ‘cryptorouble’.
Economic adviser to Vladimir Putin, Sergei Glazev, called the cryptorouble a useful tool that can evade western economic sanctions. He stated, “This instrument suits us very well for sensitive activity on behalf of the state. We can settle accounts with our counter-parties all over the world with no regard for sanctions.”
According to Sergei, the cryptorouble will have its equivalence to the rouble, however, it will be restricted in a certain way. It will also be track-able by the government. Russia expressed opposing views on cryptocurrencies. Sometimes they said they are a reality that everyone needs to face and other times they rejected it based on the principle. The First Deputy Governor of Central Bank, Sergei Shvetsov, gave a public statement saying, “We can not stand apart. We can not give direct and easy access to such dubious instruments for retail (investors).” The government will soon introduce laws that formalize the procedure on the creation and exchange of cryptocurrency in the country.
The potential of a cryptorouble is troubling for the experts. The US and the EU have responded to the Russian violations of international law using economic sanctions. This sanction prevents the Russian government, organizations, and businesses around the world from using US Dollars or other European currencies to conduct transactions. As a result of the introduction of a new cryptocurrency in Russia, the sanctions can be subverted by the country’s government.
The track-able nature of cryptorouble is also a major reason behind its creation and adoption by the Russian government. The country is also looking at additional control and surveillance over the population of the country by adopting and introducing their own cryptocurrency. The cryptorouble will be issued and controlled entirely by the Russian government. It will be equivalent to the rouble and will be a track-able currency.