Russia Bans Bitcoin As Currency

The Prosecutor General’s Office in Russia, recently made its stance quite clear on the virtual currency Bitcoin. Any use of Bitcoin will be considered “potentially suspicious,” as the Russian government has linked Bitcoin use to illicit activities.

“Systems for anonymous payments and cyber currencies that have gained considerable circulation, including the most well-known, Bitcoin, are money substitutes and cannot be used by individuals or legal entities…INTRODUCTION OF OTHER MONETARY UNITS AND MONEY SUBSTITUTES IS PROHIBITED…Citizens and legal entities risk being drawn, even unintentionally, into illegal activity, including laundering of money obtained through crime, as well as financing terrorism,” the release stated in a recent press release reported by Reuters news agency.

If you trade in Bitcoins, this does not necessarily mean that the Russian government is going to come after you.  You may see a large van parked outside your house though, sometimes for days at a time.  Of course I am joking, but you may catch the attention of some officials if you decide to continue in these endeavours when the Government is watching the use of Bitcoins with more scrutiny.

This announcement by Russia should come as no surprise really, considering it’s illegal there to trade with money substitutes. “The official currency of the Russian Federation is the Ruble. Introduction of other monetary units and money substitutes is prohibited,” the Prosecutor’s office reemphasized, citing Article 27 of Russian federal law.

Russia is the latest country in a ling line of places, to release a statement detailing its position on the virtual currency Bitcoin.  Early in December 2013, China barred financial institutions from using Bitcoin, though it did not ban the currency totally.  Meanwhile, over in Canada, their Government released a statement that said Bitcoin is not legal tender in the country.  Bitcoin has come under fire of late, not only with its links in money laundering, but also for its general volatility.

On February 7^th for instance, a string of thefts hit Bitcoin’s most reputable wallet service;  Coinbase.  Chief Bitcoin exchange Mt. Gox suspended any withdrawals and this caused prices to plummet.

We await further news to see if other countries follow suit.

[Image via: jp.ibtimes]

SOURCE: http://www.theverge.com/2014/2/9/5395050/russia-bans-bitcoin