ICO Experiment With Bank of Russia Deemed “Successful” But Officials Still Apprehensive

In a statement from a representative of Russia’s central bank, this institution announced that they have held a “successful” experiment, concerning an Initial Coin Offering (ICO). The deputy director of the Financial Market Development Department for the Bank of Russia, Ivan Semagin, said:

“Within a framework of the central bank’s sandbox, we conducted an experimental ICO on the basis of our existing infrastructure. Technically it was a success, but we still have a lot of legal issues.”

TASS, a local news agency, wrote that two institutions – Sberbank and the National Settlement Depository – were scheduled for participation in the experiment for the ICO. The experiment was setup by LevelOne, a commercial hall firm in Moscow, for the end of the summer. Despite success, Semagin ultimately said, “In the framework of the ‘sandbox' … technically everything went well, but there were a lot of issues from a legal point of view.” A further explanation was not provided.

Semagin announced the success of the trial at an annual event called the Eastern Economic Forum (EEF), which encourages partnerships and collaboration involving Russian Far East and the Asia-Pacific Region. In attendance at the forum were officials from both Russia and China. As the discussion revolved around both cryptocurrency and ICOs, the CEO of the Far East and Baikal Region Development Fund, Alexey Chekunkov, called the concept of an ICO “useful technology.”

As examples, he noted the actions of Singapore and the United States as examples of countries that have managed to establish appropriate regulations for cryptocurrency. However, when speaking about Bitcoin, he called it a:

“harmful pyramid scheme that wastes a lot of electricity in vain.”

The largest bank in Russia, Sberbank, was the first one that agreed to check test out cryptocurrency technologies. Subsequently, Sberbank decided that they would use their Swiss branch to create a crypto platform that institutional investors could use. Based on TSS’s reports, Russia followed these actions by launching a platform to work on regulatory measures back in April.

During their trial, senior vice president Igor Bulantsev said:

“Many Sberbank clients are interested in this type of investment, and we plan to promote this service proactively once the appropriate legislative framework comes into effect; we will be one of the drivers to institutionalize and popularize this type of transaction.”

Once the regulations are in the works, the Bank of Russia has to evaluate the first services and technologies to come out of it. Unfortunately, regardless of these measures, there are many officials in Russia that remain apprehensive about the introduction of cryptocurrencies, ICOs, and blockchain technology.

Earlier reports in September this year indicated that Dmitry Peskov, who is a special representative to the president, believes that the country is far from ready for circulating crypto, much less issuing it. President Vladimir Putin has even said that, based on the definition of cryptocurrency as a decentralized asset, the country cannot have its own token.

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