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  1. #1
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    Default Russia moves from Banning bitcoin payments to starting their own Cryptoruble

    Interesting developments that could re-shape the crypto currency markets

    https://www.coindesk.com/russia-like...minister-says/
    According to the state-backed news source TASS, Moiseev – who previously said that bitcoin should be classified as a kind of asset in Russia and limited to qualified investors – told reporters on Monday that "no regulator doubts that payments will be banned."
    https://www.cryptocoinsnews.com/puti...y-cryptoruble/
    According to Russian publication AIF, a closed-doors meeting between President Putin and Moscow’s political elite at the city’s Capital Club led to Putin make the significant decision to have Russia issue its own cryptocurrency, dubbed the ‘cryptoruble’. Details of the meeting were revealed by Russian minister of Communications and Mass Communications Nikolai Nikiforov.
    Whether they will take a stronger stance against bitcoin and other crypto's immediately remains to be seen, but if they see them as competition or fear that it will devalue their own currency, my guess is yes.

    Rick
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    https://cointelegraph.com/news/break...ng-cryptoruble
    The CryptoRubles can be exchanged for regular Rubles at any time, though if the holder is unable to explain where the CryptoRubles came from, a 13 percent tax will be levied.
    It is impossible to ban bitcoin. But it is possible to tax almost anything...

    Any state issued "cryptocurrency" will be like the USDT - tether. It is still fiat distributed over blockchain. So it is just technical, not fundamental change. There will be most likely no miners, the currency will be issued and controled by central banks.

    So to sum it up: such a currency much have faster transactions, but it will be even more controlled than recent electronic fiat money or paper fiat money. Why? Because blockchain provides full history of payments.

    I would not call the state blockchain currencies as cryptocurrencies. For sure it is not a competition of bitcoin. But it can pave the road for changes and thus it can only help.
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    Quote Originally Posted by Sherlock View Post
    Any state issued "cryptocurrency" will be like the USDT - tether. It is still fiat distributed over blockchain. So it is just technical, not fundamental change. There will be most likely no miners, the currency will be issued and controled by central banks.
    Quote Originally Posted by Sherlock View Post
    I would not call the state blockchain currencies as cryptocurrencies. For sure it is not a competition of bitcoin. But it can pave the road for changes and thus it can only help.
    Indeed - what is the real difference between this - and ordinary money in the bank ?

    With a single authority (the state) there is nothing to prevent confiscation, fraudulent issue, and debasing of the token.
    Will there be peer-to-peer transactions? How will the be verified?

    Simply using a blockchain as a central ledger is no better than series of bank accounts and a normal database.
    In fact you could argue it's worse because it's a lot slower.

    There are a lot of components missing in this idea.

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    Quote Originally Posted by Sherlock View Post

    It is impossible to ban bitcoin. But it is possible to tax almost anything...
    What makes you think it is impossible to ban?

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    Does anyone else think like it seems Russia is going backwards in Globalization and slipping back into more of a communist state a little bit?
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    this needed to happen you know )))
    won't be a surprise to see them ruling the crypts

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    Quote Originally Posted by Jokerman99 View Post
    What makes you think it is impossible to ban?
    I can not find the article, it was years old, about Silk Road investigation, the fraud cops and so on. The FBI agent there said clearly: we wanted to ban bitcoin, but we realized we can not. And that is true.

    The reason is the decentralized nature of bitcoin. Bitcoin is not at one server, or one cloud or at some system of clouds. Nodes can run after tor. The system works with huge reserves and it would be extremely costly to ban it. Bitcoin is probably mined even in North Korea, so ironically even NK is on the side of anarchistic freedom. The debate now: 1x vs 2x, is also about this. 1MB blocks are about maximal security; 2MB+ blocks want higher capacity, but system more exposed to attacks. There are even extreme proposals like luke-jr: 300KB blocks. Bitcoin will not go to 300KB blocks, but if some state attacks are launched, bitcoin will adjust. As AA said: bitcoin now is something different than in the past and in future will be also something else. Just the end users will not see the difference.

    This is not Liberty reserve, where they had to pick up one or two guys in Belize (or something like that) and seize few servers.

    But there are other problems: how you define bitcoin, if you want to ban bitcoin. Even bitcoiners do not know what is bitcoin. BCH and BTC have the same code until 31st July 2017. Even if the law defining bitcoin has whole blockchain in it, bitcoin is adding each 10 mins other data. It can always fork. Hardforks change whole code. This is how most other cryptocurrencies were created after all. So how to ban bitcoin then? You have to ban blockchain. But wait: there are cryptocurrencies that do not run on blockchain, but they use different cryptography. So banning bitcoin means you have to ban all cryptocurrencies. Even those which do not exist yet.

    But here the problems just start, even if countries make it to this totalitarian state: most cryptos are anonymous or pseudonymous. Just the parties involved know, that there was some payment. So banning cryptos means that you ban any financial transaction between two or more entities, that is not approved. You must create super-Orwellian and socialistic country with most of GDP sacrificed to surveillance, just to limit those transactions. Even the crippled democracy we have now would be long gone. And guess what: economy and free trade would be ruined, but bitcoin would survive this and people would be still using it (maybe in some fully anonymous form). There are countries like Cuba or Venezuela that I think ban foreign currencies. Still those currencies are widely used as reserve currency for that economies. Nobody can do anything with that and those are paper money in totalitarian states, not just some encrypted passwords.

    In Japan bitcoin is now official currency (more or less). So banning bitcoin is going against a Japanese payment system. Bitcoin is now being bought by hedge funds and soon by pension funds and people will be able to invest directly 401, IRA and so on. The more money is in, the more painful the ban is, because it would cause a loss to the voters.

    Bitcoin is here, because the regulation went too far. And more regulation will make everything else more problematic and bitcoin just stronger. For example part of bitcoin value was created by UIGEA and restrictions imposed on US gambling. Another and bigger reason are bans on cash and AML policies of banks. Bitcoin is interesting technology, but why it is so valued is not because of the technology, but because the economy is overregulated. Another regulation will make bitcoin just stronger. Have a look at the last "ban of bitcoin in China", which is just a restriction of exchanges. Bitcoin went to new highs.
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  15. #8
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    While I agree that it will be difficult for any country to effectively ban any crypto completely, although they may try, which may lead to less usage in that country overall due in part to fear.

    If Russia and other countries start to develop and use their own crypto's, whether it is in reality nothing but a new way to transact what was considered their fiat, I see this as a bold to move to try and reshape and limit the use of Bitcoin, and may be at least partially effective.

    If these moves are planned, I could see them also trying to find ways to further limit their residents to exchange bitcoin for fiat, although I wonder how quickly some exchanges will start popping up that allow direct transfer from "crypto-ruble" to bitcoin etc?

    In the early stages of any kind of release, I wonder if the value will drop significantly during the first few days, or have the opposite effect and spike higher. (although I sorta see a drop in value during the early days of release due in part to a lot of additional press using terms such as banned and outlawed - with a possible rebound after that depending on how the entire market reacts)

    In the end this may lead to a global crypto, whether it is bitcoin as it is known today, or something that has to evolve from that, only the future can answer that.

    Rick
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    I still do not understand how existence of cryptoruble can limit bitcoin exchanges.

    Either the exchanges can be limited or they can not. I think most people would agree that state has some or significant influence over exchanges, because exchanges deal with banks and banks must do what state orders. Fine. But whether there is putinshitcoin circulating or not, the state will have the same influence. It will not be bigger and it will not be smaller. The state will be still controlling the gate to btc. Now the gate is at banks, the fiat <-> crypto gatekeepers are banks. Then the gate will be at approved exchanges, which will be gatekeepers between putinshitcoin and crypto. But this will not change anything. The AML parameters might be more strict (and they will be either way), but it has nothing to do with the technology (bank databases vs blockchain) that is creating and distributing the official currency.


    People who are using bitcoin for their trades, because they have no other option, will not start using putinshitcoin instead (unless we want to play with wild imaginations e.g. Russia allowing US citizens holding putinshitcoin and use it for anything they want, which would be amusing). There is zero crowding out effect. Because bitcoin is being used where the official money can not be used. This will not change. It may even have an adverse effect: putinshitcoin push will most likely even more reduce using cash and grey and black economy. Grey and black economy will for sure not use putinshitcoin where transactions are stored inside of ledger forever. So they will turn into bitcoin even further.
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    Quote Originally Posted by universal4 View Post
    If Russia and other countries start to develop and use their own crypto's, whether it is in reality nothing but a new way to transact what was considered their fiat, I see this as a bold to move to try and reshape and limit the use of Bitcoin, and may be at least partially effective.
    If it is a move to try and limit crypto ... then it would be a bad one.

    Bitcoin and alt-coins are probably only held by 0.5% of the population as it stands. It's a little confusing, it's a little techy "black magic" and many people do not know where to start. A local government crypto simply speeds the learning process. By promoting a country online tokens and bringing it to the masses - all Russia (or any country does) is educate it's population about the existence of crypto-tokens and they would quickly learn the technology.

    Once people have the tools, then people can decide whether to hold crypto-rubble or crypto-peso, or whether they should hold their savings in a token that is globally accessible, desirable and valuable. For many people in many countries the jump to REAL crypto that is not inflated and not devalued by local politicians would be the next step.

    --------------------------

    People were suspicious of paper money too - preferring REAL money - gold Dollars, Francs, Marks, Florins, Soveriegns etc ...
    But change happened ... and is happening now too ... and at a far faster rate.

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    Offtopic:
    When cryptos will be owned by 0.5% of population, the prices will be at least 10x higher.

    In April was just little over 4M addresses of BTC funded >0.01BTC. Most people for sure own bitcoin, I guess just an absolute minority of cryptoholders have just alts.

    I do not know how significant are holders <0.01 BTC, but I do not think there are many (I may be wrong in India for example). But how many funded addresses per user? I have 100+ for sure, it is probably an exception. 4 on average is probably bare minimum with all the dust addresses of various online projects. That would be 1M people in April with more than coins in btc.

    0.5% of population is 35M people. I am fairly sure the btc penetration is still much lower than 0.5%. But it is good. Plenty of room to grow.
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    It is not just Russia that is considering and testing a crypto currency for of their own fiat, China as well as other countries have been testing and considering a rollout.
    https://www.forbes.com/sites/sarahsu...ital-currency/

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    Yes. Russia wants to have the crypto, because there are some mid-Asia countries who already announced they will start with it (not China).
    http://www.thedailyeconomist.com/201...-planning.html

    Russia clearly said something like "if we do not do it now, then someone from that area will be the first".
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    Russia was also pushing for government funding into bitcoin mining as well wern't they? Given they have super cheap electricity it's probably a good idea.

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    Better estimation here: http://bitzuma.com/posts/bitcoins-eternal-september/ (whole article worth of looking at)
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    Quote Originally Posted by TravG View Post
    Does anyone else think like it seems Russia is going backwards in Globalization and slipping back into more of a communist state a little bit?
    I do. That's the only way Putin can stay in power.

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