A top Russian official has justified the government’s plans to prohibit ordinary Russians from investing in Bitcoin technology by comparing Bitcoin-related investments with casino gambling.
On Tuesday, Russian Economic Development Minister Maksim Oreshkin gave an address at the World Festival of Youth and Students in Sochi, where he warned the young pioneers of the dangers of dabbling in cryptocurrencies.
Russian state-owned media outlet RT quoted Oreshkin saying Bitcoin’s value was too volatile: “it’s dozens of percent up, then dozens of percent down.” Any asset with such unpredictable characteristics shouldn’t be accessible by “unqualified investors” because it is “worse than casinos. First you earn, then you will lose everything and be left with nothing.”
Oreshkin isn’t wrong that Bitcoin investors face potentially damaging losses, but such risks are inherent in all investing scenarios. Kinda like the Russian casino operators whom the government encouraged to invest in the Azov-City gaming zone, only to be told a few years later that the zone would be shutting down so that new zones could open in Sochi and the Crimea, and there would be no compensation for Azov-City investors, who now stand to lose everything and be left with nothing. You know, like that.
In August, Russia announced plans to restrict Bitcoin-related investing to “qualified investors,” which the Ministry of Finance defines as having at least RUB 6m (US $105k) in an investment account, making at least 40 transactions per year with a total turnover of RUB 6m, or having two years’ experience at a financial security trading firm.
Russia’s investment restrictions were already greeted with a degree of cynicism, which only grew following news that the government plans to introduce its own blockchain-based cryptocurrency, the CryptoRuble, which will naturally be subject to strict government monitoring and taxation, just the sort of stuff that really excites the average libertarian-minded cryptocurrency fan.
The CryptoRuble plan mirrors Russia’s increasingly tight stranglehold on its citizens’ internet access. In fact, Russia’s internet is rapidly becoming a de facto intranet on par with the walled gardens on offer in neighboring China and North Korea, where seldom is heard a discouraging word about the local leadership.
Clearly, Russian President Vladimir Putin has issues with anything that isn’t under his complete control. Which got us thinking, if the CryptoRuble doesn’t pan out, maybe Putin can find common cause with the folks over at SegWit Core, who also have trouble with competing – and especially superior – ideologies.