Russia bans bitcoin

Bitcoins and other virtual currency are not allowed in Russia, the country declared.

“The official currency of the Russian Federation is the ruble. Introduction on the territory of Russia [of] other monetary units [and] ... money substitutes is prohibited,” the country’s general prosecutor’s office said in a statement on Thursday, according to a translation provided by Google.

The office added that cryptocurrenties like bitcoin, which only exist virtually, “are money substitutes and can not be used by individuals and legal entities.”

ADVERTISEMENT
Russian officials claimed that the digital currency is often used to launder money from criminal activities. Additionally, the price is set “solely by speculative actions that entails a high risk of loss of value.”

Russia’s declaration comes as countries around the world have adopted a variety of approaches to currencies like bitcoin, which have risen in popularity and value in recent months.

The Chinese central bank in December imposed strict rules on the currency, which have put binds on many financial institutions. Regulators said the step was necessary to protect the renminbi, China’s currency, and fight money laundering.

Regulators in the U.S. have taken a more hands-off approach. The Treasury Department last year declared that businesses that exchange virtual currencies into cash have to register with the government like any other money transmitting business.

American officials have also worried about the potential for abuse or money laundering, but have so far let law enforcement officials take the lead to go after criminals.