In a closed door meeting in Moscow, Russian President, Vladimir Putin, officially stated that the country will now issue its own ‘CryptoRuble’, according to local news sources.
Minister of Communications Nikolay Nikiforov broke the news and stated:
“I confidently declare that we will run CryptoRuble just for one simple reason: if we don’t, our neighbors in the Eurasian Economic Community will do it in a couple of months.”
Nikiforov said that the new Russian currency is designed to prevent people from avoiding tax enabling the government to tackle the problem of tax evasion. CryptoRuble, which will use Russian-designed encryption, will be fully regulated by the government. Unlike other coins, it will not be completely decentralized in nature. According to the Minister of Communications, CryptoRuble cannot be mined. It will be issued, tracked and maintained solely by Russian authorities. It will, however, be Blockchain-based. This can help prevent online fraud while also making the currency at least a little decentralized.
CryptoRubles can be freely exchanged for regular Rubles at any time, though proof of origin will be required. If the owner of a CryptoRuble is unable to provide proof of origin, they will be subject to a 13% tax. A 13% tax will also be applied to any earned difference between the price of the purchase of the token and the price of the sale.
While Russia is all set to enter the cryptocurrency world, other decentralized cryptocurrencies, such as bitcoin, are still considered illegal. In fact, a complete ban on all cryptocurrencies within the country was called for by Putin, calling them illegitimate replacements for the official currency. This statement seemed to be in opposition to earlier comments made by other Russian ministers. However, now that the creation of CryptoRuble has been made public, the Russian government's view of cryptocurrencies are more clear.
The President already plans on offering the currency internationally. Russia's Deputy Minister of Economic Development Oleg Fomichev said that once the CryptoRubles are launched, international investors will also be allowed to use it. “This mustn’t be a private currency, but the one, which is issued by the state, controlled by the state and enable to provide circulation of digital money in light of the digital economy,” Fomichev said.