BTC/USD: Russian central bank eases stance on Bitcoin

BTC/USD: Russian central bank eases stance on Bitcoin
Written by:
Farquar McIntosh
3rd July 2014
Updated: 21st October 2019, Thursday, July 03: The Russian central bank said yesterday that Bitcoin and other digital currencies “should not be rejected”, marking a reversal from February, when it warned that the use of Bitcoin for buying goods, services or real currencies would be viewed as a potential involvement in dubious operations and financing terrorism.

Speaking to journalists at a banking conference in St. Petersburg, the Bank of Russia’s first deputy chairman Georgy Luntovsky said: “One shouldn’t reject these instruments, perhaps they really have a future, but in our country the criminal world immediately starts to use everything new.” He admitted that there was evidence that the crypto-currency had been used to pay for drugs and weapons.

“Perhaps after a certain time we will make a decision about some legislative regulation of this issue,” Luntovsky added, noting that the central bank and government were discussing the matter.

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Bitcoin has been backed by a number of influential figures in the Russian financial sector, including German Gref, who served as the country’s minister of economics and trade from 2000 to 2007. Gref, who currently heads Russia’s largest bank Sberbank, said in January that an outright ban of Bitcoin would be a “colossal mistake”, and that bitcoin should be studied and regulated. Speaking in an interview at the sidelines of the World Economic Forum in Davos, he described the crypto-currency as “a very interesting global experiment that breaks the paradigm of currency issuance.”

The change of tone from Russia’s central bank provides a welcome respite for Bitcoin, which has come under intense scrutiny around the world, amid concerns that it could be used for illegal activities.
The collapse earlier this year of the world’s largest Bitcoin exchange Mt. Gox has added to the controversy surrounding the digital currency.
At time of writing, BTC/USD was trading at $640.91, one percent lower on the day.

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