Russia Contemplates Ban on Mining Public Blockchain Tokens


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In an interview with a Russian media outlet, Chairman of the State Duma Committee on Financial Markets, Anatomy Aksakov, revealed that Russian lawmakers might potentially introduce a penalty for mining cryptocurrency on an open blockchain, as reported by Finance Feeds on June 10, 2019.

Focus on Permissioned Ledgers

Russian lawmakers are mulling over a decision to administer penalties for those who mine cryptocurrency on a public blockchain. In the face of India’s alleged bill to ban and introduce jail time for mining or holding cryptocurrency, the lack of acceptance for digital money is proving to be an inconvenient issue in emerging market countries.

While Aksakov confirmed that operations involving cryptocurrencies and distributed ledgers were not covered by Russian law and are not considered illegitimate, mining cryptocurrencies would be banned in the country. Owning cryptocurrency in Russia is legal provided the coins were acquired under foreign laws using a foreign exchange, outside of Russia.

A survey conducted by the Russian Public Opinion Research Center in April 2019 showed that 56 percent of respondents had heard of Bitcoin, but only nine percent had basic knowledge of what it was and how it works. A majority of respondents believed that investing in Bitcoin was not profitable.

Russia is reportedly interested in establishing a national cryptocurrency backed by the gold standard and several Russians, including a Billionaire who wants a palladium backed coin, have plans of running private cryptocurrency operations within the country.

Russia’s attempts to suppress the mining of public blockchain tokens stand as a testament of their belief in centrally-controlled permissioned ledgers. The same can be said for India and China, who have been vocal of their disdain for Bitcoin and other public cryptos while exploring the potential of blockchains.

The cluster of regulators and governments that are jumping into action to crack down on digital currencies has been a significant talking point of the last few weeks.

G20 countries were expected to take a more accommodating stance on digital currencies so as not to hinder their innovative potential. Conversely, Russia, India, and China have taken a seemingly oppressive position under the notion of money laundering and criminal activity.

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