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Vladimir Putin Orders Work on ‘CryptoRuble’ to Counteract U.S.-Led Sanctions

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Russian President Vladimir Putin has ordered his government to begin work on a national cryptocurrency, which the media has dubbed the ‘CryptoRuble.’ Although Moscow has already expressed interest in a national cryptocurrency, the latest call is driven by a desire to circumvent Western sanctions against Moscow.

Cryptocurrency to Fight Economic Sanctions

Putin’s orders were initiated after a meeting with economic adviser Serge Glazev, who indicated that a nation-backed cryptocurrency would be a “useful tool” to circumnavigate U.S.-led sanctions.

According to the Financial Times, Glazev indicated that a national cryptocurrency “suits us very well for sensitive activity on behalf of the state. We can settle accounts with our counterparties all over the world with no regard for sanctions.”

Glazev says the Cryptoruble would be similar to the national currency, but with supply and circulation “restricted” to allow the government to monitor its moves. As CCN reports, it remains unclear whether the CryptoRuble would be issued by the Bank of Russia or some other government body.

Since 2014, Russia has been under economic sanctions by the United States and its European allies over its alleged involvement in destabilizing Ukraine. The sanctions were officially targeted in March 2014 after the Crimean referendum, which resulted in Russia’s annexation of the region. Relations between Russia and the U.S. have deteriorated in recent years, with both sides backing opposing factions in the war on Syria.

Before the new year, Russia’s finance minister indicated that the Kremlin was developing legislation to govern cryptocurrency trading. The new laws will govern all aspects of the crypto economy, from taxation to mining. The announcement came just months after Russia briefly banned then reinstated cryptocurrency trading and indicated it would implement specific regulations to govern the market.  Not even two years ago, the Finance Ministry said it would pursue seven-year prison sentences for bitcoin users.

The shift in sentiment reflects growing acceptance of cryptocurrency among mainstream and government circles. In fact, Russia’s decision not to ban cryptos came after Putin met with members of government and the business community. In the case of Russia, it also represents the need to develop new ways of kick starting a moribund economy. Russia was hit hard by the oil-price collapse, with sanctions making the situation even worse.

Growth appears to have returned, with gross domestic product (GDP) expanding for four consecutive quarters through Q2 2017.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 603 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Vanuatu Joins List of Countries Issuing Crypto Licenses

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The country of Vanuatu approved and delivered a ‘stock exchange license’ to a cryptocurrency exchange for the first time ever, according to reports coming from the platform in question.

DSTOQ (which launched yesterday, along with a ‘tester’ MVP) announced the public reveal of their project along with the claim of being “the first fully licensed stock exchange for trading security tokens and investing in real-world assets using cryptocurrencies.”

Due to being a member of the Commonwealth of Nations, the license as obtained by DSTOQ will only be viable at present in European territories primarily, rather than the USA.

Vanatu: What, Where and Why?

The Republic of Vanuatu is a nation of islands located in the South Pacific ocean, and one that made crypto headlines earlier this year, when it was mistakenly reported that the modest population’s government would be patriating new citizens in exchange for a “$200,000” Bitcoin payment. Claims which the country’s citizenship office vehemently denied.

This wouldn’t be the first time the Vanuatu had caught the eyes of the financial press, as the country was listed by Forbes as being amongst “The tax havens hidden in plain sight” where the writer noted that banking organisations as large as “ANZ and Westpac have offices” in the country.

Countries for Crypto

Other countries that have been considered ‘tax havens’ by Western pundits (and members of their own national press outlets), such as Taiwan and Singapore have been noted for their particular leniency towards if not acceptance and support of cryptocurrencies.

The recent news coming out of Vanuatu suggests that they may be the latest to join a growing number of nations which could alternately be referred to as ‘Crypto Havens’, with regards to regulation and enforcement.

These nations skirt the traditional barriers to entry which face many potential investors as well as companies. A strong example of this can be seen with Hong Kong, which has relatively lax laws covering the mining and trade of cryptocurrencies in comparison to neighboring China – which has implemented almost-blanket bans.

In European mainland, Estonia has also proven itself to be a clear proponent for licensing with regards to cryptocurrency – with the country’s government going as far as to issue wallet and exchange licenses to organisations which it deems fit.

What Does This Mean?

It’s promising to see a diverse range and geographical dispersion of countries officially on-boarding cryptocurrency into their nations’ governmental economic and cultural strategies for the future, however it is also telling that all of the most enthusiastic proponents of the technology are isolated entities. Singapore, Taiwan, and Hong Kong for example, are nation-states – despite many of them having close cultural and ethnic ties with their neighbouring nations; Vanuatu is a multitude of islands separated from the world by sea; and even Estonia is mostly surrounded by water, with its vast collection of peninsulas.

This physical distance from other countries is somewhat representative, however, of their political distance from the rest of the world – as well as that of their influence. Until the trend starts spreading further, to countries with greater sway and presence on the global stage.

In this light, it’s worth taking a look at how the Financial Conduct Authority in the United Kingdom is approaching cryptocurrency, a country with a long and seminal role in both historical and modern financial markets. The agency has called for a world-wide “effort to speed up fin-tech growth” and utilised its relations with other countries in an attempt to establish a global regulatory “sandbox” with the aspiration of speeding up or mitigating the formal approval processes.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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“We should prohibit U.S. persons from buying or mining cryptocurrencies,” says Rep. Brad Sherman

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A Congressional Financial Services Committee meeting today turned alarmingly hostile to cryptocurrencies and blockchain technology as a whole.

This hostility stemmed initially from Democratic Representative Brad Sherman, who stated,”We should prohibit U.S. persons from buying or mining cryptocurrencies.”

According to a senior political journalist from Politico in attendance at the meeting, Rep. Sherman believed that mining is so exceptionally energy intensive and that it’s so much much more environmentally damaging than it’s potential utility is worth and thus, that the government should ban it to eliminate the possibility of further destruction.

Importantly, but likely not coincidentally, is the fact that Rep. Sherman’s biggest campaign contributor was a credit card processing company.

The company is Ally Wallet, which describes itself as, “The preferred online merchant services company and online global payment gateway solution for businesses that need to accept online payments.”

Unfortunately, Rep. Sherman’s utterances were not the only anti-cryptocurrency statements at the hearing. Specifically, Alex Pollock, a fellow from the Pro-Free Market think R Street Institute, stated his view that, “a central bank virtual currency is one of the worst ideas in recent times.”

When this is combined with Fed Chairman Jerome Powell’s comments earlier this week that, “a Fed-backed cryptocurrency is not something we’re looking at”, it paints a picture of a government increasingly alarmed by the growing use of cryptocurrencies in general.

Chairman Powell, also raised an issue with Bitcoin’s use in money laundering and other financial fraud. He elaborated further by stating that “there are too few places taking crypto as payment and the value is too volatile to be a stable store of value. Cryptocurrencies undermine the U.S. sanctions regime against terrorists/adversaries.” Powell concluded when pressed that he saw, “more risks and concerns in cryptocurrency than in its potential use.”

Additionally, at the same meeting, Representative Ryan Peterson stated that “I’m someone who believes we should still be on the gold standard and I think we need to audit the Fed because I don’t trust them.” Rep. Peterson also allegedly stated his belief at the meeting that, “digital currencies are Ponzi schemes.”

It is somewhat alarming in the opinion of this analyst that an ignorant consensus seems to be forming in the upper echelons of government that views cryptocurrency as inherently a threat to their power, and that as a result it must be stopped.

Luckily, there was some pushback from a representative of “Bitcoin University”, albeit after the meeting. This individual confronted Rep. Andy Barr, who is a Financial Services Committee member, and exclaimed that “he needed to bring more Bitcoin experts into the next hearing.”

Whether these combined statements is ultimately reflective of a US federal policy shift remains to be seen. But for proponents of Bitcoin and cryptocurrency, they serve as a reminder that those in positions of power will not lose their status without a fight.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Government of Malta Passes New Cryptocurrency Legislation

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Malta’s embrace of digital currency came full circle Tuesday after lawmakers passed three separate crypto-related bills that could transform the island nation into a blockchain powerhouse.

‘First in the World’

CCN broke the news Wednesday that all three bills have gone through Malta’s legislative process, putting them on track for full implementation. The second reading of the bills was carried out Tuesday night in a plenary session that began at 6:00 p.m. local time, parliamentary records show.

The approved bills include the Virtual Financial Assets Act (VFA),  the Innovative Technology Arrangements and Services Act and  the Malta Digital Innovation Authority Act (MDIA).

VFA deals specifically with the regulation of initial coin offerings (ICOs), ordering new token projects to publish whitepapers and detailed descriptions of the entire project.

The  Innovative Technology Arrangements and Services bill governs blockchain startups and other businesses looking to leverage distributed ledger technology.

MDIA will effectively serve as an industry-specific governing body that will support the development and implementation of blockchain-based regulations.

Parliamentary Secretary Silvio Schembri said the bills were a ‘first in the world’ development and also announced the person heading the newly created MDIA:

“Today Maltese Parliament unanimously approved 3 bills on DLT/blockchain, a 1st in the World. Honored to have driven these bills. Announced that Mr Stephen McCarthy will be the CEO of the new #Malta Digital Innovation Authority.”

Blockchain Island

Malta has quickly emerged as a prominent player in the blockchain industry, having already lured major exchanges and businesses to its borders. Binance has announced plans to relocate to the tiny Mediterranean nation and earlier this month disclosed that it has opened a bank account in the country. OKEx, another prominent exchange, has also announced plans to make Malta its new home.

Binance and OKEx are the world’s largest cryptocurrency exchanges by trading volume, each processing more than $950 million in daily transactions.

Binance’s decision to relocate was largely driven by its desire to enable fiat-to-crypto deposits and withdrawals, something Malta says it will accommodate through local bank partnerships.

Changpeng Zhao, Binance’s CEO, has described Malta’s regulatory stance toward blockchain and cryptocurrency as “logical, clear and forward-thinking,” adding that “dozens” of similar exchanges are planning to relocate to the country.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 603 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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