Sat, 20 Oct 2018
Saint Petersburg

Report: Russia working on cryptocurrency to evade sanctions

By Sheetal Sukhija, St Petersburg News
03 Jan 2018, 09:14 GMT+10

MOSCOW, Russia - A new explosive report has revealed that Russian officials are developing a cryptocurrency with the agenda to help the country evade international financial sanctions.

According to a report in the Financial Times which citing Moscow officials, the Russian President Vladimir Putin has commissioned government agencies to work on a “cryptorouble.”

According to the report, the cryptocurrency would be another way to complete financial transactions in roubles, Russia’s currency, while evading sanctions that limit the country's financing options.

The report added that Russia is still ways off from releasing the cryptorouble but a state-run cryptocurrency could hinder attempts by the United States to hinder Russia’s economy.

Over the last year, the U.S. banned dozens of Russian government officials, agencies, businesses and Putin allies from using the country’s financial system or dollar. 

After its 2014 annexation of Crimea from Ukraine, the U.S. began increasing economic pressure on Russia.

What added to the pressure is that shortly before leaving office, U.S. President Barack Obama imposed further sanctions on officials, hackers and agencies involved in Russia’s interference with the 2016 U.S. presidential election. 

Earlier this year, Congress passed sweeping new economic sanctions on Russia, which President Donald Trump grudgingly signed into law.

According to experts, Russia’s reported plan to create a cryptocurrency comes as U.S. regulators and lawmakers attempt to understand the booming financial technology.
The report stated that regulators have warned investors that digital currencies are subject to federal financial regulations.

Further, investors have been warned to tread carefully with their trades. 
It pointed out that the Commodity Futures Trading Commission has warned investors that digital currencies’ volatility could add unexpected risk to trades and contracts. 

In May last year, the Securities and Exchange Commission begun cracking down on unregistered and fraudulent cryptocurrency sales after it was qualified as securities.

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