Russia Bans Bitcoin Exchanges and Information Websites Without any Notice or Investigation

By Prashant Jha

In what can be called aristocracy at its best, Russian Roskomnadzo has yet again come down heavily on Bitcoin exchanges and various informative websites in the country. The Russian authority has blocked a website which was approved by them, not very long ago. It’s quite common for the Russian government to ban things without conducting a fair investigation.

Artem Kozliuk, Head of RoskomSvoboda anti-censorship NGO, said:

“Workers of the local Prosecutor’s Office need to fill the statistical reporting about how they successfully fight with restricted materials. Local courts sometimes receive papers based on this, and the court automatically blocks the site without sending a hearings invitation to the owner. Then, all those decisions appear in Roskomnadzor, usually after the period of appeal ending.”

The website in question CryptoRussia was at the receiving end of the crackdown of crypto-related services by the government authorities. The website was paid an amount of 150 thousand rubles as a compensation fee by the authorities. The website was earlier delisted from the blacklist, so the ban actually creates quite a confusion for the crypto community and raises more question over Russia’s inconsistent censorship policy.

This ban comes only weeks after President Putin asked the authorities to finalize the crypto regulations and the framework to use crypto in the country.

Russian Authorities Stance Towards Bitcoin and Crypto are Quite Worrying

According to a Kuibyshev local Omsk court decision from July 24th, 2018, users have limited access to four major crypto related websites operating in the country. These websites include Bestchange.ru, Fastobmen.net, Pushpayer.com, and Xchange.cash.

The Russian court considers Bitcoin and other crypto related digital assets as, “monetary surrogate which helps the growth of the shadow economy, and cannot be used by citizens and companies on the territory of Russia.”

looking at the governance structure of Russia, the authorities are quite skeptical of the crypto use in the country. The fear of a decentralized system of finances is quite evident from the fact that 23% of the censorship of websites are related to cryptocurrencies.

Three of the four websites banned by the government used to operate anonymously, given they did not ask for any form of KYC to use its services. These three bans can be argued whether they were right or wrong, but the fourth ban was totally out of the blue as the website Bestchange.ru, is a rating website which helps the citizens to find the best exchange with the help of a rating system.

The rating website actually helps the government to find the defaulters and potential scams, so banning the website which adhered by the rules and principles of the policymakers and actually helped them in busting the websites which were not adhering by the regulations, is quite peculiar.

Many believe these crackdowns can really hamper the progress of crypto in the country. Russia is one of the most preferred data centers and a growing hub for mining operations given the climate conditions and the availability of cheap power resources.