Bitcoin suffers blow as Russia bans websites offering crypto-currencies

Published: October 10, 2017
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Bitcoins are seen in this illustration picture taken September 27, 2017.  PHOTO: REUTERS

Bitcoins are seen in this illustration picture taken September 27, 2017. PHOTO: REUTERS

Russia will block access to websites of exchanges that offer crypto-currencies such as Bitcoin, Russian Central Bank First Deputy Governor Sergei Shvetsov said on Tuesday.

He called them “dubious”.

Russian financial authorities initially treated any sort of money issued by non-state approved institutions as illegal, saying they could be used to launder money.

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Later the authorities accepted the globally booming market of crypto-currencies but want to either control the turnover or to limit access to the market.

“We cannot stand apart. We cannot give direct and easy access to such dubious instruments for retail (investors),” Shvetsov said, referring to households.

Speaking at a conference on financial market derivatives, Shvetsov said the central bank sees rising interest in crypto-currencies because of high returns from buying into such instruments.

He warned, however, that crypto-currencies gradually transform into high-yielding assets from being a mean of payment.

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Bitcoin, the most well-known virtual currency that emerged in mid-2010, last traded at around $4,807, up from its initial price of less than $1.

“We think that for our citizens, for businesses the usage of such crypto-currencies as an investment object carries unreasonably high risks,” he said.

Russian authorities said earlier this year they would like to regulate the use of crypto-currencies by Russian citizens and companies.

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