Russia Flirts With Tougher Crypto Laws, according to Putin Special Representative

After several months in which Russia’s State Duma still hasn’t made any headway with regards to regulation on cryptocurrencies, the country’s presidency is beginning to put pressure on both the central bank and the country’s legislative body to do something about the situation.

“The central bank has, in my opinion, adopted the most liberal position in the sphere of regulating cryptocurrencies, but the level of threat is so great that this position could be more rigid,” Dmitry Peskov, special representative on digital and technological development to Vladimir Putin, told RIA Novosti in an interview.

Peskov made it clear that he believes that the government “should [...] warn everyone that the probability that we will get to MMM 2.0 is maximum”. This is his way of comparing cryptocurrencies to Ponzi schemes.

MMM was a Russian company that took advantage of people’s naivete after the collapse of the Soviet Union, creating a Ponzi scheme that would eventually become one of the largest in the world. By the end of the 1990s, the scheme resulted in millions of people losing all of their savings after they had been convinced to invest everything they had into it.

MMM was shut down by police in 1994 only to later return as MMM Global in 2011, targeting countries suffering from widespread poverty and a lack of government regulation in Africa and South America.

Peskov did not elaborate on how exactly he believes that the central bank’s behavior could be shifted with regards to cryptocurrencies. Presently, The Bank of Russia already forbids the exchange of rubles for coins.

This isn’t to say that the bank can’t do more. A while back, the Reserve Bank of India sent out directions to commercial banks asking them to stop doing business with cryptocurrency operators.

If Russia’s central bank does the same, it could effectively ban cryptocurrencies in the country. We don’t think that such a move is likely, as even Peskov did not appear to be hinting at a total ban.

However, the unpredictability and lack of clarity by the Russian government might impact the country’s exchanges and startups.