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    February 10, 2014

    Russia bans Bitcoin and other “money substitutes”

    Countries around the world are scrambling to give their official stance on virtual currencies and Bitcoin more specifically. According to Russian officials, “Systems for anonymous payments and cyber currencies that have gained considerable circulation “” including the most well-known, Bitcoin “” are money substitutes and cannot be used by individuals or legal entities.” Any use of Bitcoin will be considered “potentially suspicious,” as the Russian government has linked Bitcoin usage to illicit activities.

    Their argument is that “citizens and legal entities risk being drawn “” even unintentionally “” into illegal activity, including laundering of money obtained through crime, as well as financing terrorism.” It isn‘t exactly certain what the penalties would be if you used Bitcoins. In fact, they made a statement that you wouldn‘t be completely banned from using it, but it would place you on a watch list.

    “The official currency of the Russian Federation is the ruble. Introduction of other monetary units and money substitutes is prohibited,” the Prosecutor’s office reemphasized, citing Article 27 of Russian federal law.

    China has also banned financial institutions from using Bitcoin, though it hasn‘t been banned outright for the public. The future of Bitcoin looks like it is going to be volatile most of the time, but we will wait and see.

    Source: Reuters

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