Putin Investigating 'Cryptorouble' as Way to Avoid Western Sanctions

President Vladimir Putin has reportedly commissioned Russian officials to work on developing a national cryptocurrency dubbed the "cryptorouble."

According to the Financial Times, Sergei Glazev, an economic adviser to the president, told a government meeting that the cryptocurrency would serve as a "useful tool" to evade western economic sanctions.

Glazev explained:

"This instrument suits us very well for sensitive activity on behalf of the state. We can settle accounts with our counterparties all over the world with no regard for sanctions."

The adviser indicated that the cryptorouble would be equivalent to the rouble, but with its circulation "restricted in a certain way," and allowing the Kremlin to track its moves.

It is as yet unclear, though, whether the cryptocurrency would be issued by the country's central bank, the Bank of Russia.

Previously, the president has ordered his cabinet officials to devise a framework for establishing and regulating a digital currency within Russia, a move that following his meeting with ethereum founder Vitalik Buterin last summer.

In October 2017, Putin further mandated new regulations around cryptocurrencies, including the registration of miners and the application of securities laws to initial coin offerings (ICOs).

Russia's finance minister, Anton Siluanov, announced in September 2017 that his department will regulate the use of cryptocurrencies in the country by the end of 2017. There is "no point in prohibiting" cryptocurrencies as they are a "reality," he said.

Vladimir Putin image via Shutterstock