Bitcoin Could Threaten Financial Stability Of Russia—Report

In an interview with Russian Rossiyskaya Gazeta newspaper, the head of Russia’s Investigative Committee, Alexander Bastrykin said that concerned governmental agencies in co-operation with the Investigative Committee have proposed to introduce criminal liability for issuing and circulating quasi-money, particularly bitcoin, as reported by RAPSI news.

“Criminal responsibility for the release of or trading in monetary surrogates, which are not considered under the law as a method of payment, has been directed to the interested bodies in cooperation with the Investigative Committee,” Sputnik News quoted Bastrykin said.

He noted that the circulation volume of monetary surrogates in the country has already reached one percent of GDP, Sputnik News reported. If this figure rises by 10 percent or more, Bastrykin warned, cryptocurrencies could become a “real danger” to the financial stability of the state.

“Unchecked expansion of the money supply via surrogate growth will lead to the devaluation and a gradual elimination of the ruble from the currency market. As a result, the state could lose its monopoly on money emission, as well as the income it generates," he said.

Bastrykin added that as the popularity of these money surrogates is growing and they are becoming more competitive than conventional currencies, the market must be restricted in its initial stage itself.

According to recent reports, Russian lawmakers submitted a new draft bill to the country’s legislative assembly Duma in December to ban digital currencies such as bitcoin.