Putin’s internet ombudsman pessimistic about crypto regulation

Despite Russian officials' increased interest in cryptocurrencies like Bitcoin (BTC), Russia’s internet ombudsman expressed confidence that local crypto regulations will remain largely prohibitive.

Dmitry Marinichev, Russia’s ombudsman for the protection of entrepreneurs' rights under Russian President Vladimir Putin, on Wednesday discussed Russia’s approach to cryptocurrency regulations at a panel of a major local industry event, Blockchain Life 2021.

Russia will continue taking a restrictive stance on crypto because the Russian government doesn’t want Russian people to make money with Bitcoin, Marinichev said:

“I’m sure that Russian crypto policies will always be prohibitive because no one is looking to allow Russian people to earn money with crypto operations and no one will ever authorize them to proceed with payments using other money than ruble. It is important to be aware of this.”

Marinichev also argued that Russian crypto laws, including the country’s first crypto-focused law, “On Digital Financial Assets,” or DFA, have nothing to do with individual investors and were rather adopted due to the strong demand from big business and state-backed companies.

“The DFA law only targets big companies and has nothing to do with the industry. It hasn’t affected common people and enthusiasts in the crypto and blockchain industry,” the ombudsman argued. He also noted that Russia’s energy prices are not that attractive to cryptocurrency miners, claiming that the United States has the “cheapest electricity” in the world.

Marinichev was appointed as Russia’s internet ombudsman by President Putin back in 2014. The official has been apparently deeply involved in the crypto industry, suggesting using cryptocurrencies by residents of Crimea in 2017. He was also planning to repurpose his metal factory, Russian Mining Company, into a crypto mining facility in 2019, expecting to mine 20% of the world’s Bitcoin.

Related: Russia does ‘absolutely nothing’ to regulate crypto, RACIB head says

Marinichev’s remarks on Russian crypto regulations follow the nation's local governments becoming increasingly interested in crypto, with some ministries proposing to mine Bitcoin with associated gas. At the same time, the Russian government remains skeptical of Bitcoin when it comes to the interest of its own residents, with the Bank of Russia looking to block certain transactions to crypto exchanges.