Crimea Planning A Digital Currency Fund To Bypass Sanctions

Authorities in Crimea have indicated that they want to unveil a virtual currency fund aimed at foreign investors. This way, it will be possible for Crimea to bypass the economic sanctions which have been placed on it following the annexation of the region from Ukraine by Russia. This was disclosed by Crimea’s deputy prime minister, Georgy Muradov.

According to Muradov, the purpose of the virtual currency investment fund would be to collect digital assets which would then be converted into fiat currencies. These fiat currencies would then be exchanged into cash and then invested in projects in Crimea. Per Muradov, this would be the best way of avoiding settlements in either euros or dollars as the two currently face currency restrictions.

Yalta International Economic Forum

The deputy prime minister of Crimea disclosed this information prior to the holding of Yalta International Economic Forum. During the forum, the head of the financial market committee in the lower legislative chamber of Russia, Anatoly Aksakov, indicated that Initial Coin Offerings and digital currency exchanges might be allowed in Crimea. However, Aksakov indicated that the same treatment would not be afforded to mining cryptocurrencies due to the fact that the region currently experiences electricity shortages.

Last year in April, bitcoin (BTC) bull and Russian businessman, Boris Titov, suggested that the Eastern European peninsula be transformed into a virtual currency haven and become a home for various blockchain and digital coin businesses.

Russia softens stance

This comes at a time when Russia is making progress with regards to the adoption of virtual currencies. The third biggest bank in Russia, Gazprombank, announced that it will conduct transactions in virtual currencies in Switzerland later in the year under a pilot project through a Swiss subsidiary.

At the moment, regulators in Russia are coming up with draft policies aimed at streamlining the virtual currency sector. A final draft is expected to be unveiled in July and it is understood that this piece of regulation will legalize as well as set guidelines pertaining to Initial Coin Offerings, mining of virtual currencies and blockchain technologies.

Initially, the president of Russia, Vladimir Putin, had been skeptical of virtual currencies due to the fact that the sector is unregulated as well as its decentralized nature. It is understood that he has softened his stance as cryptocurrencies get more and more popular. Additionally, Russia is also said to be planning on launching its own virtual currency in order to bypass economic sanctions.