According to local reports, the daily trading volume of major cryptocurrencies like Bitcoin and Ethereum in Moscow alone reach $50 million on peak days, which is relatively small in comparison to major cryptocurrency exchanges but largely given the regulatory uncertainty in Russia.
Russia, one of the few countries alongside China and India to have restricted crypto trading, is seeing an increase in demand for over-the-counter (OTC) investment in Bitcoin and other cryptocurrency assets.
Aleksei Karpenko, senior partner at the law firm Forward Legal, said:
“There is a common rule – if specific transactions are not prohibited, then they are allowed. This is a matter of agreement between a buyer and a seller.”
Currently, investing in cryptocurrencies is not illegal based on local laws. Because cryptocurrencies are considered as properties, as long as the capital being invested in the cryptocurrency market comes from a legitimate source, it is technically legal for citizens and residents of Russia to hold cryptocurrencies.
Previously, the Russian government drafted three legislations around cryptocurrencies and crypto-related businesses, addressing the legality of exchange operators and cryptocurrency trading. But, the approval of the three bills was postponed to the end of 2018 and until the government definitely approves businesses to operate as cryptocurrency exchanges, the market will not see the emergence of regulated cryptocurrency exchanges. There is regulatory uncertainty in Russia.
China, unlike Russia, has strictly prohibited the trading of cryptocurrencies. Hence, it is not legal for local residents and citizens to purchase or hold cryptocurrencies.
But Hong Kong reported that there is still trade going on between fintech platforms like Alipay and OTC platforms in the mainland but still cryptocurrency exchange market of China has continued to remain active.
Hong Kong-based digital asset exchange Tidebit executive Terence Tsang Tsang said: “The latest warning and potentially increased monitoring of foreign platforms is targeted at a batch of smaller exchanges that had claimed to be foreign entities, but are in fact operating in China claiming they have outsourced their operations to a Chinese company.”
Countries like India, Russia, China has banned investment in ICO and to increase consistently in the years to come, regardless of the state of policies in the three countries.