Bitcoin in Russia as a Foreign Currency

The use of Bitcoin in Russia is currently illegal, but news has come out today from an official in Russia’s Ministry of Finance who stated Bitcoin could be used as a foreign currency. The change to the proposed law would not allow Bitcoins to be used domestically, but deputy finance minister Alexei Moiseev said this move is to help limit Ruble alternatives domestically.

Even though Bitcoin cannot officially be used in Russia, this would help remove uncertainty that is associated with the ledger technology blockchain. Moiseev spoke about Bitcoin to the state-owned newspaper Rossiyskaya Gazeta. This is a huge change for the organization which has been pressing for years for a ban of all digital currencies, and also wanted to make using digital currencies as a punishable crime. The Russian Central Bank has maintained a more positive look at digital currencies, however, and it looks like the organization is softening up to the idea of these currencies.

The ban on using Bitcoin in Russia is believed to be part of the Constitution. The Russian Constitution says that Ruble has to be the sole currency used for national commerce, which means Bitcoin would still never be allowed to be used domestically. Moiseev is still saying that laws might be adjusted in order to allow citizens to profit from Bitcoin when used as a foreign currency, but it has to be in locations where that is legal. Russian citizens would then be able to buy Bitcoins and keep them in their wallet and then sell these Bitcoins for profit in those foreign countries.

There is currently nothing really preventing Russian citizens from using Bitcoin in Russia, but the threat of Bitcoin overtaking the Ruble is what people are concerned about. This concern could lead to punishment if used domestically, which is what the Russian finance minister is trying to figure out. There might be a new law coming into the state law-making body before the end of this year to allow the use of Bitcoin as a foreign currency according to Moiseev.