The idea of a digital currency has spread across every continent and almost every country since the launch of Bitcoin in 2009, but it has met resistance throughout that journey from law makers and regimes right across the world. One of the most hostile regimes towards digital currencies has been that of Russia, who were even going as far as criminalizing the use of a digital currency, with a penalty of a fine of up to $40,000 or even prison sentences. However, last week that proposal was scrapped, and with a slightly less aggressive stance towards cryptocurrency in the country, just days later Moscow saw the opening of its first Bitcoin exchange.
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Russia has had a rocky relationship with the digital currency industry almost since its inception, at various times considering banning the use of any cryptocurrency outright along with various levels of restrictions also being considered by the lawmakers. Indeed, it was only a week ago that they rowed back on plans to criminalize Bitcoin use that could have seen fines of up to $40,000 or even prison sentences for those caught using any cryptocurrency. However, in the short time since that particular approach was abandoned, a Bitcoin Exchange has been launched in Moscow itself.
The exchange provides an offline service, and transactions are only one way, with customers visiting the exchange in person to sell their bitcoins in a private transaction. Bitcoin purchases are as yet not available. It has been opened by a team of bitcoin enthusiasts, and while this is a far cry from the services available elsewhere in the world, it is a significant step in a country whose authorities have been extremely hostile to the concept of digital currencies themselves. If this proves successful, the team are planning to officially register the exchange and expand on the services available while remaining in compliance with the local authorities.
There are two interesting things about this development, the first is the speed that the enthusiasts were able to get the exchange up and running once the lawmakers abandoned the proposal to criminalize digital currency use. This not only shows the enthusiasm within Russia for cryptocurrencies, but also demonstrates the market that has been waiting for the chance to be involved with the digital currency industry within the country.
The second is the move by the authorities to reverse their approach towards the cryptocurrency industry and refrain from trying to turn Bitcoin users into criminals. As one of the most openly hostile regimes towards digital currencies, this represents a significant step. Russia is a potentially huge market for Bitcoin and other cryptocurrencies, and this change in attitude from the authorities could allow the digital currency industry to really gain market penetration within the country now the threat of severe legislation has effectively been removed.