There has been a mixed reaction to President Vladimir Putin’s push for crypto and ICO regulation. He has been criticised by some local experts for what they see as an unnecessarily heavy handed approach, although others have given him their cautious backing.
“In terms of blockchain legislation, Russia is still at the inceptive stage,” says Alan Wong, Senior Vice President APAC, Storiqa, which has developed a blockchain powered e-commerce marketplace. “We are seeing legislature development by the Russian government and we are still at the draft stage. There is no indication when the specific frameworks will be announced. However, one thing is beneficial; expedient final laws to guide the blockchain space will give further impetus and guidance for the industry.”
Blockchain is starting to penetrate many areas of Russian life. But, as is often the case with new, disruptive technologies, controversy is never far away, fuelling calls for regulation. The Russian Association of Cryptocurrencies and Blockchain recently created a registry of whitelisted companies that offer crypto-related products or services. It says that, since early 2018, legal entities and individuals in Russia have lost more than 270 million rubles [US$4.3 million] from crypto-related investments organised by scammers and incompetent companies.
“The list of trusted companies will allow Russian and foreign market participants to base their work on trusted organisations and minimise the risk of fraud in the creation and development of Russian or foreign business in the field of mining, trading with cryptocurrency, blockchain technology and ICOs,” it says.
The hope is that regulation etc brings stability without derailing Russia’s flourishing startup community. Storiqa’s Wong comments: “Russia is a leader in blockchain product development. ICOs are a natural development where fund raising as a crowdfunding platform is efficient but there is a deep need to validate and verify the projects and background of teams.”
He adds: “The talent and domain knowledge in Russia in IT and AI is very advanced. Storiqa’s development team is based in Moscow but we have registered offices in Hong Kong and Singapore. They are the two top hubs in Asia. We have started business initiatives in both cities and recently at the RISE conference in Hong Kong, we shared what our Storiqa Wallet prototype offers.”
Watch this space for regular updates on both regulation around blockchain in Russia and the country’s flourishing startup scene.