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In Russia, the “supervised legalization” of cryptocurrencies

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will most likely be adopted

Judging by the information of people directly related to the development of Russian cryptocurrency legislation, the authorities are inclined to follow the path of “supervised legalization” of crypto assets .

Recall that in early August, Russian Prime Minister Dmitry Medvedev instructed the Ministry of Finance and the State Duma to adopt a bill on digital financial assets by November 1 of this year.

Earlier, President Putin had already set the deadline for the adoption of regulatory standards – until July 1 of this year – however, the State Duma was not able to adopt regulatory acts before the end of the spring session. Apparently, for this reason, such a deadline was established, because the government, parliament and central bank have been busy with this issue for about five years.

The lack of a legislative framework has led to uncertainties in relations between the state and the cryptocurrency market, especially since over the past five years, legislators, financiers, and officials have made strikingly different statements on cryptocurrencies.

The most radical position is taken by the head of the Bank of Russia Elvira Nabiullina, who actually called cryptocurrencies “money surrogates”. Moreover, the position of Nabiullina has been publicly supported by President Putin several times. However, representatives of other government agencies, as a rule, were not so categorical in their assessments.

So, at the beginning of the year, Prime Minister Medvedev from the rostrum of the Gaidar Forum called for “not to rush to bury cryptocurrencies in connection with the depreciation”. By the way, he turned out to be right – later the course began to grow. The same Putin, although he supported Nabiullina, in 2017 called "not to block unnecessary barriers" (in this area).

At the moment, we have a full-fledged document – a draft of the bill. According to the head of the Duma committee on financial markets, Anatoly Aksakov, the document is almost agreed. Only the status of cryptocurrencies in Russia remains unresolved in it. The government is currently considering three regulatory options:

  • unconditional legalization of cryptocurrency circulation in Russia;
  • a ban on working in an infrastructure with an open blockchain;
  • Legalization of cryptocurrencies and digital money under the supervision of the Bank of Russia.

Theoretically, any of the three options can be implemented, and the first – unconditional legalization – is undoubtedly preferable for the crypto community. Clear advantages in this scenario will be the development of the mining industry and the attraction of large domestic and foreign investments in regions with cheap electricity. However, this scenario completely deprives regulators of leverage.

In addition, critics say, the potential disadvantages of full legalization are wide opportunities for scammers, cybercriminals, drug dealers, pornography makers, corrupt officials, and tax evaders.

Legalization is also fraught with a significant increase in the volume of the shadow economy, which is associated with the high anonymity of most cryptocurrencies. It can be argued that the use of cryptocurrency financial instruments by criminals has nothing to do with legalization and or prohibitions. Terrorists, drug dealers and pornographers can continue to use crypto assets for criminal purposes and in the event of a ban.

The main and insurmountable obstacle to full legalization is the Russian legislation, according to which, the only legal tender in the country is the Russian ruble. Therefore, hoping for an unconditional resolution of the cryptocurrency turnover is most likely not worth it.

The second regulatory scenario is a ban on working with currencies on the open blockchain . Such a ban does not solve the problems with criminalizing the market, since it is possible to legally ban the use of such assets, but in fact it is impossible. For the shadow business, nothing will be changed during the ban, but law-abiding market participants will suffer: miners, investors, and traders.

In addition, the ban on working with the open blockchain will bury potential investments that may benefit many of the northern and north-eastern regions of the Russian Federation. For many enterprises in regions with cheap electricity that have been idle since the collapse of the USSR, the creation of industrial mining zones and mining hotels would be a boon. The ban will deprive them of these opportunities.

The third scenario is supervised legalization. The most logical step seems to be just the legalization of cryptocurrencies under the supervision of the Bank of Russia. The fact that parliamentarians and government officials plan to apply controlled, controlled legalization is hinted at by the information shared with journalists by the head of the State Duma's working group on cryptocurrency risk assessment Elina Sidorenko and the head of the department of planning and coordination of scientific activities of the Krasnodar University of the Ministry of Internal Affairs of Russia, Ph.D. Zarina Khisamova.

According to them, the document preparing for adoption takes into account the global practice of regulating digital assets, that is, it implies supervised legalization.

In a scenario with a controlled cryptocurrency market, the Bank of Russia will play a key role in regulatory matters. In this case, business – mining, trading and investment – can be carried out using legal trading and mining platforms created either by the Bank of Russia itself or with its participation. Thus, the state will become one of the beneficiaries of operations with cryptocurrencies. The advantages of the legal status of cryptocurrencies will be preserved, and the risk of losing control over them will be minimized.

At the same time, it is still unclear how the regulator intends to control blockchain transactions , mining, and also identify users. The main problem will be the creation of control algorithms and their technical implementation. The effectiveness of state regulation of the crypto market will depend on this.

Publication date 08/17/2019
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Institutionals bet on bitcoin growth, positions on BTC futures doubled

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One of the indicators that signal a possible change in the price of bitcoin is the number of open futures positions on the Chicago SME exchange.

In October 2019, institutional investors doubled the cost of long positions in BTC futures contracts , the Cointelegraph reports.

Institutional Investors Interested in BTC

According to a study conducted by analysts on October 22, the estimated value of the long positions of institutional investors rose to a value above 1000 bitcoins, compared with data on October 1, when this value fell below 500 BTC.

Data on long-term futures on the CME exchange indicate a turning point in the downward interest of the institutional, outlined in September 2019. The sharp collapse coincided with the launch date of physically delivered bitcoin futures from the Bakkt platform , when interest fell from 1300 VTC to below 500 bitcoins.

Analysts at Skew Markets have additionally indicated that institutional investors include:

"… pension funds, insurance companies, mutual funds and investment portfolio managers."

Such analytical data may indicate the continuing desire of large investors to enter the cryptocurrency market.

Recall, the head of CFTC believes that next year, the market may begin to trade futures on Ethereum (ETH) . He also noted that in addition to Bitcoin and Ethereum, other cryptocurrencies can also be classified as goods.

Publication date 10/23/2019
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Tim Draper believes that Ripple coin is preparing for a sharp increase in

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The investor, Bitcoin bull Tim Draper, believes that the current situation in the Ripple market can be called the “calm before the storm” – in his opinion, in the near future, the XRP rate may suffer explosive growth.

During his communication with the participants of the crypto market at the Quora forum, Draper noted that, given the three-fold increase in the Bitcoin exchange rate over the past 5 months, it can be expected that the Ripple coin will also demonstrate similar behavior.

According to the investor, the price of XRP should have already increased to about $ 0.6 or $ 0.9, taking into account all the latest developments of the project and the conclusion of new partnerships. Draper drew attention to the fact that the project is constantly improving its technology for cross-border payments. Moreover, Ripple belongs to the largest SBI corporation, which includes such a serious company as R3. So, according to the investor, everything indicates that now there is only a “calm before the storm”, that is, a calm before the explosive increase in the value of the coin.

Meanwhile, Ripple is developing further. On the eve it became known about the intention of the project to expand its presence in Washington. Brad Garlinhouse, CEO of Ripple, noted that this step will allow the company to be closer to regulators, to train them on the principle of operation of blockchain technology and cryptocurrencies.

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Opera became the first browser in which the built-in bitcoin-wallet

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Opera web browser developers have added support for TRON bitcoin payments and cryptocurrencies to their application for Android devices, CoinDesk writes.

From now on, Opera users will be able to make payments in Bitcoin (BTC) directly from the digital wallet built into the application and interact with decentralized applications on the TRON network. According to the company, these features can help attract new holders to its cryptocurrencies from its database of 300 million users.

“Most people heard about Bitcoin, and we decided to add its support, as well as introduce a wider group of users to this function ,” said Charles Hamel, head of cryptocurrency business at Opera.

In July 2018, an Ethereum wallet was added to the Opera app for Android. The company explained this decision by its desire to contribute to the development of Web 3.0 and implement the vision of creating a decentralized Internet of the future on the blockchain. Later, the release of a cryptocurrency- oriented browser for iOS and a desktop version with support for a digital wallet took place.

Hamel claims that Opera applications are already optimized for working with Web 3.0, however, the integration of bitcoin required additional resources due to the differences of the first cryptocurrency.

“Bitcoin is a completely different phenomenon, which requires its own infrastructure and has a payment-oriented application scenario,” he added.

Publication date 10/23/2019
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Name Price24H (%)
Bitcoin (BTC)
$7,472.05
-8.80%
Ethereum (ETH)
$158.80
-7.76%
XRP (XRP)
$0.271679
-7.33%
Bitcoin Cash (BCH)
$208.22
-8.93%
EOS (EOS)
$2.73
-6.83%
Stellar (XLM)
$0.059796
-6.00%
Litecoin (LTC)
$49.03
-9.60%
Cardano (ADA)
$0.036419
-7.48%
Tether (USDT)
$1.00
-0.14%
Monero (XMR)
$53.37
-8.03%
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