Putin Orders the Issue of Russia's National Cryptocurrency – the Cryptoruble

Russia’s president Vladimir Putin has reportedly ordered the issue of the national cryptocurrency, the “cryptoruble.” The Russian Minister of Communications and Mass Media has revealed some details of this new currency.

Also read: Putin Confirms Russia Will Regulate Cryptocurrencies

Putin’s Executive Order

Russia’s Minister of Communications and Mass Media, Nikolay Nikiforov, said at a closed meeting with members of the Moscow Capital Club that Putin has ordered the issue of the country’s own cryptocurrency, the cryptoruble, AIF newspaper reported on Saturday.

This decision followed the meeting that Putin had with Russia’s top regulators last week where he instructed the central bank not to create “unnecessary barriers” to cryptocurrencies. Referring to the text of the government’s decree on the issuance of the cryptoruble, Nikiforov said:

I so confidently declare that we will [soon] launch a cryptocurrency for one simple reason: If we do not, then in 2 months, our neighbors in the Eurasian Economic Community will do it.

Preliminary Details of Cryptoruble

Nikiforov believes that “the cryptoruble will be issued quickly,” the publication noted. The official also said that the efficiency of the new cryptocurrency will “streamline the payment of personal income tax,” which would make the new currency legal tender in Russia.

The country currently has a flat 13 percent income tax rate. However, Putin has called for a reform of the tax system in order to boost economic growth. He ordered the tax code to be adjusted in 2018 and be implemented in 2019, according to The Moscow Times.

While Nikiforov said the details of the cryptoruble have yet to be discussed, AIF reported him explaining:

When buying and selling a cryptoruble, the amount will be 13% from the earned difference…If the owner can not explain the reason for the appearance of his cryptorubles, when converting them into Russian rubles, the tax for him will be 13% of the total.

Furthermore, the cryptoruble cannot be mined, the minister noted, adding that “most likely, it will be a closed model with a certain volume of regulated emissions.”

Russia’s Central Bank advocated for a national cryptocurrency earlier this month. Deputy Governor, Olga Skorobogatova, said at the Finopolis forum of innovative financial technologies that the bank sees many benefits in a state-run cryptocurrency. Also among the supporters for a national cryptocurrency is First Deputy Prime Minister Igor Shuvalov, who said in August that a cryptoruble should exist.

Cryptoruble Is Not Legalization of Cryptocurrencies

Regarding the regulation of cryptocurrencies, the minister explained that:

The creation of the cryptoruble would not equal the legalization of bitcoin and other cryptocurrencies. Russia’s cryptocurrency should use Russian cryptography.

After the meeting with Putin last week, the regulators decided that Russia will regulate cryptocurrencies. The finance ministry is working with the central bank to draft a bill which is expected by the end of the year, according to Finance Minister Anton Siluanov.

What do you think of the cryptoruble? Do you think it will succeed? Let us know in the comments section below.

Images courtesy of Shutterstock and AIF.

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