Moscow hosted Blockchain Bitcoin Conference Russia on November 10, one of the biggest industry events in Eastern Europe.
Attending the event were dozens of representatives for banks, major international companies, organizations and media. The conference in Moscow, similar to the one held earlier in Kyiv, had two sections: finance + regulation, and technology. Bitcoin enthusiast and entrepreneur Alex Fork hosted the financial section, while Ivan Tikhonov, Bits.media founder, was a host for the technical one. ForkLog team focused its attention at the financial section since it seemed the most appealing to our audience.
Speakers included Stanislav Polozov of Emercoin, who talked about the company’s new banking tools; Elina Sidorenko, chairwoman of the Russian Parliament’s working group for cryptocurrencies; and Blockchain.Community chairman Artyom Tolkachev.
Konstantin Lomashuk, Cyber.Fund co-founder and blockchain evangelist, presented the recently launched Golos (“Voice”) project, describing its architecture and internal economic stimuli among other things.
Elina Sidorenko spoke about legal status of cryptocurrencies and ways of their regulation. According to Sidorenko, today there are four approaches to cryptocurrencies in the West: regulators may define virtual currencies as money surrogates, commodity, financial tools, or monetary assets.
“How do we see the prospects of legal settlement as to this issue? I’d rather just say that Russia, similar to other countries, lacks a clear understanding of what cryptocurrencies actually are. We’ve been having lengthy discussions about the most reasonable approach at various international meetings. The most high profile case is that of Daniel Hedqvist, when the European Court of Justice has ruled that bitcoin transactions “are exempt from VAT under the provision concerning transactions relating to currency, bank notes and coins used as legal tender.” This approach is still the most popular in Europe, even though some countries recently started considering rejecting it,” Sidorenko said.
According to her, this approach is popular due to its ‘comprehensible economic and legal interpretation, and an opportunity to develop a national cryptocurrency for any country.’
“Therefore, we have to think about cryptoruble, and how it will be issued. It would let us expand our understanding of how the Central Bank would be involved in this issue. If it would not be about mining, it would at least be about supervision of mining of those monies. But we don’t take that way. Why? For instance, we have to establish a certain exchange rate of cryptocurrency, and somehow control it. Moreover, are we really ready to consider cryptoruble as a sort of an economic substitute for ruble, for example, when we make cross-border transactions ? If we exchange 100 rubles for 100 cryptorubles and send them to Ukraine, Kazakhstan or elsewhere, the intended recipient receives 100 rubles, while cryptoruble is a some kind of a substitute for SWIFT. This model certainly looks interesting, but, unfortunately, its potential is null these days,” Sidorenko concluded.
She also stated that on December 15, 2016, State Duma’s working group on assessment of cryptocurrency risks will hold a meeting to present two possible legislation concepts in this regard. The meeting is to decide what way the working group will take thereafter.
The next to speak was Artyom Tolkachev, who talked about two options of cryptocurrency regulation. In his opinion, it would either involve amendments to the Civil Code (which would consider virtual currencies a property with such features as conveyance, value and acceptance), or equalizing virtual currencies to foreign currencies, with the latter approach involving specific taxation rules.
Tolkachev also spoke about regulation of smart contracts, issuance of tokens, and initial coin offerings.
“You all know stories behind successful or unsuccessful ICO’s. We receive many requests to help out with running an ICO, and there are indeed many questions. They don’t have certain answers. It’s a rapidly developing and pretty popular technology, and we, certainly, don’t talk anybody out of using it. But still, the first question we usually ask is “Do you really want to give legally valid rights to your investors?” People usually say ‘yes’ at first, but later they start realizing what consequences it may entail, and say nay. As a result, ICO becomes a sort of a regular crowdfunding with no obligations.”
The conference was attended by representatives for BitKan and HaoBTC, one of the biggest China-based online wallets and the world’s seventh biggest mining pool. Daria Petrova of BitKan spoke about peculiarities of the Chinese blockchain and cryptocurrency market. Also she stated that BitKan intends to take a share of the Russian-speaking market from Localbitcoins.
Ekatherina Frolovicheva, the managing director for Sberbank’s Center for Technological Innovations, couldn’t attend the conference, so her colleague Kirill Ivushkin spoke on her behalf. His speech was about blockchain projects not being able to solve such fundamental issues as customer security, overall legality, and having sufficient qualified staff to service customers promptly.
“If you need help tomorrow, who you gonna call? Cryptocurrency projects websites often have a feedback form, and that’s it. The project’s employees won’t solve your problems, they won’t even talk to you. Traditional banking service is quite different, so we believe that banks won’t disappear when the new technologies come,” he noted.
Marco Krohn, co-founder and CFO of Genesis Mining, spoke about the history of mining and the company’s mining strategy, as well as about cloud mining in general.
Overall the conference has proven that the community and the industry have definitely matured with many new players present, China-based companies interested in local markets, and great opportunities for business partnerships and employment of experts. All this leads to even more interest to cryptocurrencies and blockchain technology and makes banks and government entities to research the ongoing developments more thoroughly.