Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


Will the Kremlin Adopt Cryptocurrency?

The U.S. Congress’s heavy handed move to sanction Russia, over the war in the Ukraine may have forced the Russian Federation onto the cryptocurrency bandwagon.

“I am a supporter, a cryptocurrency must exist,” Russia’s First Deputy Prime Minister Igor Shuvalov told RBC. Shuvalov revealed that the Kremlin has been working on altcoins for some time. When they talked about the blockchain, they agreed that we would work cautiously-the government together with the Central Bank and the FSB (the Federal Security Service of Russia).”

“But it should develop in such a way that the national economy cannot be put under attack, but rather make it stronger,” Shuvalov said. Please note that this is translated from Russian and Cyrillic via Google, so it is undoubtedly full of errors.

It is obvious that Shuvalov sees cryptocurrency as the basis of a new economy and an economic weapon that will give Russians an advantage in global competition with America and China. His view sounds a great deal like that of officials at the People’s Bank of China (PBOC). The PBOC has been working on its own cryptocurrency and has been linked with the NEO altcoin and platform.

“Many people have such a naive attitude that the cryptocurrency is bitcoins, everyone is ill with mining, people think that they can quickly earn huge fortunes and all that,” Shuvalov said. “But this is a very simplistic perception of what we actually discussed.”

Will Russia become a Leader in Cryptocurrencies?

“A blockchain for us is not the ability to generate the equivalent of the monetary value of signs, including (and perhaps primarily) a mechanism that will provide a very professional, transparent and fast state service,” Shuvalov revealed. “Now we are looking at how to make it possible to provide services on the state register through the block account.”

That sounds as if Russia is looking into distributing government benefits via the blockchain. It also sounds as if Russia might become a leader in cryptocurrency and blockchain technologies.

Russia would have a huge advantage in the cryptocurrency field because the nation has vast amounts of cheap electricity. One of the few useful accomplishments of the Soviets was to build lots of hydroelectric, nuclear and other power plants. Strangely enough, that Communist effort might give Russia an edge in 21st Century cryptocurrency warfare.

Another advantage that Russia will have in cryptocurrency is its’ well-educated population and excellent university system. Sberbank boss German Gref proposed adding blockchain training programs at key universities at a meeting of the Kremlin’s Council for Strategic Development and Priority Projects.

Is Russia Planning Government Cryptocurrency?

Waves which is promoted by an organization called Digital October (ironically enough a pun on the October Revolution that created the Soviet Union) might be Russia’s national cryptocurrency.

One has to wonder if Waves (token: WAVES) an ethereum-type platform similar to China’s NEO , might be another effort to create a government-backed cryptocurrency platform. There has been some speculation that NEO is backed by the People’s Bank of China (PBOC), the central bank of the People’s Republic.

If it is WAVES might be a good investment, particularly if large companies like Burger King keep adopting it. News reports indicate the Burger King Russia is planning to launch its’ own WAVES based altcoin called WhopperCoin. Another obvious use of WAVES would be to get allow Russians and foreigners investing in Russia to get around sanctions.

It looks as if the Russians have learned from their history. Russia missed out on the computer and internet revolutions of the late 20th Century; and lost the Cold War in the process, because of the Communist stupidity. One obvious application for WAVES would be to give Russian companies an advantage in global economic competition.

Today’s Kremlin leaders are not making the same mistake with fintech, blockchain and cryptocurrency. Hopefully, America’s leaders will be paying attention, and not put the United States at risk for a Russian cryptocurrency assault.