There was a great combination of fear and hype over the coming of cryptocurrencies and blockchain in general. The negativity and scepticism was enormous, but enthusiasm and the need for innovation won the Eastern European hearts and minds. What followed should be taken as an example of all countries in the world. The restrictions, which Eastern European governments have placed on cryptocurrencies have paid out. These countries have now become an incredible part of the global crypto market. There are many start-ups and projects introduced all the time. In general, Eastern European countries have now become stable pillars between Asia and the West, who still dominate the industry.
Eastern Europe has had a rocky economic development in the last century. There weren’t much causes to celebrate, especially after the 2008 financial crisis. Kiev, the capital city of Ukraine has a demand to raise a statue Satoshi Nakamoto. That’s the sort of popularity the crypto industry has in Eastern Europe and mainly in the ex-Soviet Colonies. Future development has been a key issue, ever since these countries have gotten their freedom. This futuristic economical concept is warmly welcomed by everyone, with great hopes for tomorrow.
Eastern Europe and Russia won’t sleep through this economic opportunity
Russia however didn’t have many warm thoughts on the subject. Although cryptocurrencies have seen a huge boost in popularity, the country’s central bank and government, due to Russia’s past have been mostly hesitant. Russia has many unfulfilled promises, when it comes to failed economic reforms. Ksenia Yudaeva, first deputy governor of the Central Bank of Russia has stated that “The rouble is the only transactional currency allowed in Russia”.
There are other crypto-optimists such as Dimitry Marininchev, who has his own IT company, Radius Group. He was appointed as a liaison between the government and the Internet companies back in 2014. He is currently building the “Russian Mining Center”, which is a 9000 square-meter warehouse, turned cryptocurrency farm. It’s Marinichev’s hope, that this project can show the benefit that cryptocurrency can have on the Russian economy, since the West doesn’t have a full monopoly there. On the other hand, Russia’s banking system is still under heavy sanctions by the EU and US.
Putin has come up with his support of Russia’s involvement with cryptocurrencies, but is concerned with the lack of transparency and potential for money laundering and anonymous financial crime. He recently commissioned a blockchain version of the rouble, the crypto-rouble. The currency will be state-controlled and will enable the government to profit from the country’s large underground economy. Organizations or individuals, who trade in their crypto-rouble for the rouble, without proof of the legal obtaining of the coins, will pay a 13% tax rate. Venezuela has also taken steps to copy this process. As ironic as it is, these two countries, could be the start of a blockchain technology revolution.
Ukraine has definitely had a rougher time with cryptocurrencies when the law is mentioned. The line between legal and illegal is very gray there. The government’s hostile relations with Russia have helped many rogue agents take advantage of the whole debate about lawful and forbidden. The CEO of Exmo Finance, a very popular bitcoin exchange, was kidnapped and released after 48 hours, but only after paying $1 million ransom in bitcoins. This was followed by a drop in the price of BTC. There are many unfortunate accidents like this and this is unfortunately giving Ukraine a very bad reputation. Ukraine has been called the “North Korea of Europe” and the “Wild East”. The lack of regulation has seen cryptocurrencies used for weapon purchases and funding terrorism, at least according to Ukraine’s interior ministry.
Eastern Europe is changing, by the unfavorable political climate and by the winds of change from the blockchain technology. We can only hope this new technology is used for progress and peace, not for war and greed. Cryptocurrencies are the first step towards a more free and prosperous future. In due time, more restrictions and barriers will fall and all countries will prosper, together.
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