To combat money laundering, Russia may legalize bitcoin after all next year

800px-rian_archive_802356_military_parade_on_red_square_on_may_9

In a backflip worthy of a gold medal in an Olympic diving competition, the Russian government has announced it may legalize bitcoin next year after previously trying to ban it.

The news of the potential move to legalize bitcoin came from Russian Deputy Finance Minister Aleksey Moiseev, who said that monitoring cryptocurrencies could be an instrumental tool against money laundering. He said bitcoin and other digital currencies could be recognized as a way for the government to develop rules against illegal transfers.

“The state needs to know who at every moment of time stands on both sides of the financial chain,” Moiseev told Bloomberg. “If there’s a transaction, the people who facilitate it should understand from whom they bought and to whom they were selling, just like with bank operations.”

Bitcoin laws in Russia have previously resulted in confusion. The country banned bitcoin sites in January 2015 before the decision was overturned later the same year. The Russian finance ministry called for an outright bitcoin ban in June 2016 with the exception of foreign currency transactions. In August, Russia saw the opening of its first physical bitcoin exchange in Moscow, which as SiliconANGLE noted at the time opened despite the uncertainty about the legal status of bitcoin in the country.

Should Russia proceed with legalizing bitcoin, it will join a growing list of countries that have decided to embrace cryptocurrencies instead of opposing them. Japan did so earlier this month, a move that led to both a boost in the price of bitcoin and plans that could see bitcoin accepted at hundreds of thousands of retail outlets.

Legalizing bitcoin to track transactions is a different proposition. NewsBTC noted that “the government’s vision to monitor all transactions and parties to these transactions seems a bit overreaching,” adding that with modern blockchain tools, it’s not impossible either.

Photo: Vladimir Rodionov/Wikimedia Commons