Despite saying it was working on plans to legalize cryptocurrencies, Russia has just announced a decision to block access to the websites that offer cryptocurrency exchanges. It’s currently unclear if the move is permanent or temporary.
No Crypto in Russia
Russians looking forward to incorporating cryptocurrencies like Bitcoin into their lives awoke to less-than-stellar news Tuesday morning, as Russia now intends to block cryptocurrency exchanges and the websites that offer them.
As reported by Reuters, Central Bank First Deputy Governor Sergei Shvetsov called cryptocurrencies “dubious” during a conference in Moscow. He went on to add that digital currencies like Bitcoin and Ethereum are something people shouldn’t be able to easily access.
“We can not stand apart. We can not give direct and easy access to such dubious instruments for retail (investors),” said Shetsov. According to CoinTelegraph, the deputy governor further backed up the decision, saying financial instruments based on digital currencies are nearly impossible to support; additional regulations would need to be put into place to prevent the Russian domestic market from dealing in cryptocurrencies.
As for the ban’s effect on digital currencies, CNBC reports that Bitcoin experienced a $600 drop in value around the same time as the announcement, though it quickly recovered soon after.
Yet Another Ban
Russia’s decision comes after China and South Korea imposed similar bans on cryptocurrencies and initial coin offerings, though China’s is said to be temporary. For Russia, specifically, it comes as a bit of a surprise. It was only last month that the country struck a deal to create Ethereum Russia, and soon after, Finance Minister Anton Siluanov stated plans were in the works to legalize cryptocurrencies.
“The state understands indeed that crypto-currencies are real. There is no sense in banning them, there is a need to regulate them,” said Siluanov at the time.
The ban may only be temporary considering these plans, and may have only been enacted until proper regulations are put forward later this year. If the ban is permanent, however, it will be yet another market digital currency has lost a foothold on, and another potential setback to the currency’s worldwide adoption.
Disclosure: Several members of the Futurism team, including the editors of this piece, are personal investors in a number of cryptocurrency markets. Their personal investment perspectives have no impact on editorial content.