Russia’s VTB Bank's CEO: "Very, Very Dangerous to Invest in Cryptocurrencies"

Several Russian analysts have made comments regarding bitcoin and cryptocurrencies in recent weeks. German Gref, the head of Sberbank, has stated that cryptocurrencies are becoming a part of daily life in Russia, whereas as the head of VTB International, Riccardo Orcel, has stated that Russian interest in bitcoin has been overblown by the media. In other news, Etoro analyst, Mikhail Maschenko, discussed the growing perception of bitcoin as a hedge against the traditional financial markets among professional investors.

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Cryptocurrencies “Are a Fact Of… Life” – Head of Sberbank

German Gref, the head of Russian state bank Sberbank, has discussed the growing popularity of bitcoin in Russia. Speaking at a meeting of the Russian entrepreneurs association, Mr. Gref stated that “Virtual currencies are a natural outcome of blockchain technology. We may ban them, we may welcome them. It is trendy to urge people not to play with them. But they are a fact of our life,” Gref said at a meeting of the Russian entrepreneurs association.

Mr. Gref warned against Russia seeking to prematurely prohibit bitcoin, emphasizing that cryptocurrencies will comprise an enduring phenomena, and that the growing cryptocurrency economy will afford considerable opportunities to Russian businesses. “Protectionism is just the first reaction of the state. However, both the institution of private money and the states, which will dare to change the way currency is issued, will eventually find a place for cryptocurrencies in the economy,” said Mr. Gref.

Russian Investors Use Bitcoin as Hedge Against Traditional Markets

Speaking with RT, eToro analyst, Mikhail Maschenko, has discussed increasing interest in cryptocurrencies on the part of professional investors. Mr. Maschenko stated that “The demand for bitcoin is growing as the crypto market has become less volatile, and an increasing number of professional investors see it as insurance.”

Mr. Maschenko expressed optimism regarding bitcoin’s short to medium term outlook, stating “We could see a bitcoin at $10,000 in a month or so. However, such a surge will be based on emotions, not on fundamental factors. So, further growth of the cryptocurrency will require something more than euphoria… LedgerX launched its first long-term options for bitcoin, with an expiration date of December 28, 2018. In the coming months, we will continue to see the ‘domestication’ of bitcoin: the Chicago Board Options Exchange and the Chicago Mercantile Exchange are planning to launch tools based on the cryptocurrency in the near future.”

VTB Bank Is Skeptical of Bitcoin’s Popularity in Russia

Riccardo Orcel, the head of Russian bank VB International, has played down the popularity of bitcoin in Russia – describing such as overblown by the media. In an interview with CNBC on Tuesday, Mr. Orcel said “There was some speculation that there was some buying coming from Russian investors, but more than these reports, as a bank, we have not seen much in terms of flows.There was some interest reported in the press but I’ve not seen in Russia a lot of interest in bitcoin, to be honest.”

Andrey Kostin, VTB Bank’s president and CEO, has stated that he is “a little bit skeptical” regarding cryptocurrencies generally. “We see a lot of high speculation factor in cryptocurrencies and I think it’s dangerous,” he said. “Until the governments decide how to regulate this area I think it will be very, very dangerous for investors to invest in cryptocurrencies.” Perhaps alluding to blockchain technology, Mr. Kostin added “Clearly fintech is the future for the banking industry. For a country of the size of Russia, clearly having branches around the entire country is just not possible and fintech is the future.”

What is your response to these differing opinions on cryptocurrency in Russia? Do you think that bitcoin will become a part of everyday life, or is the media exaggerating the presence of cryptocurrency in Russia? Share your thoughts in the comments section below!

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