Russia Prepares to Regulate Crypto; will Launch Oil-Backed Cryptocurrency

According to the latest information coming from the Russian State Duma, we may very soon witness legislation to regulate cryptocurrency in the country. This has been reported by a local news provider which states that the Economic Policy Committee of the State Duma has finalized the framework for regulating the cryptocurrencies in the state. Many see this friendly stance of the state legislative assembly towards the crypto opposite to the conservative viewpoint adopted by the central bank of Russia towards Bitcoin and other digital currencies. Duma is working towards a friendly integration of digital assets into the economy within a specified legislative framework which should bode well in the future. The legislation is expected to go through the process by March 2019 post which the government could bring in its digital currency under the specified crypto regulation framework.

Blockchain Push

Not only Russia is showing a positive stance towards the cryptocurrency, but the country is also betting big on the blockchain technology as it moves forward with the plan of launching a cryptocurrency based on the oil. According to the Igor Yusufov, a former energy minister who had with worked Vladimir Putin during latter’s first presidential term; Russia is in the final stage of launching its own cryptocurrency-version of the petrodollar. Talking to the Rambler, Yusufov, who is the chairman of the Fund Energy Founder, said that they would bypass the various financial and trade restrictions while launching their own crypto. Many other oil producing countries are also willing to increase the production of oil and gases without relying on the petrodollar. Yusufov claims that with more than the two-thirds of the total oil reserves in the world is controlled by OPEC countries; it is absolutely beneficial for the group to come together for gaining strategic as well as economic benefits based on shared interests.

US Sanctions and Crypto launch

At present, many oil-producing countries like Russia, Venezuela, and Iran are facing US sanctions that have been imposed by the current US president, Donald Trump. The economic sanctions led by the US are taking a toll on these countries even as efforts are underway to find an amicable solution to the issue. In order to bypass the sanctions, Venezuela launched its own oil backed cryptocurrency named Petro; however, President Trump was quick to sign an executive order banning any kind of US dollar transactions related to the Petro. Russia, on the other hand, is cautiously treading its path on the oil-based cryptocurrency project. The country will first launch its crypto-oil project in the Commonwealth of Independent States (CIS) which will ensure minimum interference from the US government. In addition, this strategy will also enable the government to set up a comprehensive framework between the oil and energy producers and the various consumers in the CIS.

Yusufov also drew the attention to the intergovernmental agreement between Turkmenistan and Russia in the field of gas and energy. The agreement involves the purchase of the gas by Russia’s Gazprom from Turkmenistan until 2028 and can probably emerge as the very first center for an oil-based cryptocurrency project which Russia is planning to launch soon. It is interesting to notice that the role of cryptocurrency and the blockchain technology is transcending the boundaries of conventional business applications and founding relevance in many geopolitical issues also. The launch of oil-based cryptocurrency will definitely enhance the application of the digital currency while providing an extra boost to already surging blockchain technology.

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