Russia’s State Duma Working Towards Adoption Of Crypto Laws, Possible Oil-Backed Coin To Release
Cryptocurrency has been slowly sneaking into many economies around the world, forcing them to either implement regulations or ban it. Luckily, many economies are seeking to keep it within their borders to help drive the economy or even just to benefit their cities. The lower house of the Federal Assembly in Russia, better known as the State Duma, may been looking to implement a cryptocurrency law after a review process in March 2019.
A member of the State Duma’s Economic Policy Committee, Oleg Nikolaev, said that the process of creating this law is in its final stages. Once it is ready and approved by the Committee, it will make it possible to continue development within Russia of blockchain technology and cryptocurrency.
The former energy Minister in Russia, Igor Yusufov, one of the first plans to focus on cryptocurrency has been proposed by the head of Energia Corporation. The company aims to develop a cryptocurrency that is backed by oil, and the ex-minister has said that the plan for this use is also in the final stage, much like the implementation of the law.
Yusufov believes that having an oil-backed cryptocurrency would make it possible to avoid the costs to Russia and its allied in the evolving exchange rate between the US dollar and their own currency. Furthermore, it would reduce the costs against trade restrictions, currency exchange commissions, and more.
There are two options that the former minister sees with the potential to a physical peg for the cryptocurrency – tying it to a ton of conditional fuel or to the value of CO2 emissions. Furthermore, considering that the cryptocurrency would likely be based on the blockchain, Yusufov believes that the asset would improve traceability as it verified the origins of oil barrels without added fees.
Still, remember the Petro from Venezuela? The Venezuelan government’s plan was also to have a state-backed crypto asset that was tied to oil, which launched in October 2018 after substantial hyperinflation. Much of the purpose was also to bypass the international trade sanctions, like Yusufov’s goal.
Interestingly enough, almost no one even accepts Petro. The Russian government, for example, has refused to accept Petro, saying that it just is “not happening.”