As the 9th annual BRICS Conference is underway in Xiamen, China right now, one of the more interesting topics on the agenda for discussion is that of cryptocurrencies. And there have been some very interesting developments take place which appear to be putting severe restrictions on some of these cryptocurrencies, while at the same time offering an even larger discussion on the BRICS countries developing their own centralized cryptocurrency to replace ones like Bitcoin.
Bitcoin is not appropriate for use within the Russian economysince it is based on foreign cryptocurrency algorithms, Russian Communications Minister Nikolay Nikiforov said Monday, moreover adding that the country was capable of designing its own digital currency.
“Bitcoin and Etherium are cryptocurrencies developed on the basis of foreign cryptography. Russia has its own cryptography school. I think that we are absolutely capable of creating a cryptographic unit, a tool, based on the blockchain technology, and work out concrete regulations to set the framework for the operations,” Nikiforov told reporters.
The minister also warned of “blindly worshiping Bitcoin,” stressing that the currency is alien to Russia, as it does not use Russian cryptographic technologies. At the same time, Nikiforov gave assurances that he would not make any personal investments in Bitcoin.
He also said that the Russian Ministry of Telecom and Mass Communications had developed proposals on regulating cryptocurrency circulation in Russia.
“The proposals have already been developed, and they will be filed to the government,” Nikiforov said. – Sputnik News
The People’s Bank of China has banned ICOs outright, calling them illegal and fraudulent.
The legality of cryptocurrency is best described as “evolving” or “undefined” in most countries. Hundreds of cryptocurrency mines exist, although their creations are best described as “barter” if a willing buyer wants to exchange a product or service for them, rather than commonly accepted legal tender.
Bitcoins and other cryptocurrencies have been legally accepted as money in Japan since 2014, owing to a government decision that acknowledged that there are no existing laws that can unconditionally ban individuals or companies from receiving cryptocurrencies as payment.
The People’s Bank of China doesn’t make it illegal for private parties to hold cryptocurrencies, but bans financial institutions from holding or transacting in them. – South China Morning Post
The BRICS countries might discuss the possibility of creating the organization’s own cryptocurrency as an alternative to other payment systems, Head of the Russian Direct Investment Fund (RDIF) Kirill Dmitriev said Monday.
“Another topic discussed by the financial committee was cryptocurrencies. The creation of BRICS’ crypto currency as an alternative to other payment tools might also be discussed,” Dmitriev said.
According to Dmitriev, the BRICS member states prioritize payments made between the countries in their own currencies.
“However, crypto currencies are also being discussed as one of the possible options for financial settlement. For particular payments it might be quite relevant and serve as a good alternative to dollar or any other currency,” Dmitriev added. – Sputnik News
As a result of these discussions and announcements, Bitcoin, Ethereum, and most other cryptocurrencies fell during Monday morning trading.
One of the more important things to look at should the BRICS decide that de-centralized cryptocurrencies are to be banned or restricted is that the five primary nations that make up the coalition equate to approximately 40% of the global economy. And as of now 58-70% of all cryptocurrency transactions take place in just three Far Eastern countries (China, Japan, South Korea), and any legal policy that may come out of one or more of these three will have a significant affect on the use and the price of Bitcoin, Ethereum, etc… in the future.
Source: The Daily Economist