According to the industry leader, the Russian cryptocurrency market has grown to hundreds of billions of dollars despite the lack of proper cryptocurrency regulations.
Sergei Khitrov, founder of the Russian crypto event, Blockchain Life and List.Help, delivered a keynote speech on Wednesday about the state of crypto regulation in Russia at the Blockchain Life VII Forum in Moscow.
Based on analytical data, including domestic cash flows related to services such as cryptocurrency mining, Khitrov estimated the Russian cryptocurrency market at around 20-40 trillion rubles ($280-550 billion). He also argued that Russian crypto companies could generate taxes of up to 284 billion rubles ($4 billion) annually if the Russian government instituted better rules for the industry.
But as Russian regulators have continued to ignore industry interests in recent years, local crypto firms could do nothing but continue operating illegally or flee to other jurisdictions to survive, Khitrov told Cointelegraph.
“Without rules that take into account the interests of the crypto community, crypto services will not be provided legally. It is not profitable for the company to step out of the shadows,” he said.
According to Khitrov, none of the domestic cryptocurrency exchanges have officially opened their business in Russia, despite the large market size:
“We know a lot of cryptocurrency exchanges with Russian roots, but unfortunately these exchanges are either not officially registered or are only based in other jurisdictions.”
The CEO said he is deeply committed to negotiating crypto legislation with various government agencies, and regulators are well aware of the flight of cryptocurrency for local individuals and businesses to other jurisdictions. According to Khitrov, the Russian government has been looking at ways to bring the big crypto businesses back home, but it has failed to meet the needs of the industry.
He also stressed that the Russian crypto community has so far shown a “complete lack of understanding” of how to pay taxes on cryptocurrencies.
On the subject: RACIB chief says Russia “does absolutely nothing” to regulate cryptocurrency.
The Blockchain Life Forum, founded in 2017, is a major cryptocurrency event in Russia that takes place twice a year. The latest Blockchain Life Forum was held in Moscow on Tuesday and Wednesday, bringing together more than 5,000 participants and speakers, including industry representatives and government officials such as Russian Internet Ombudsman Dmitry Marinichev and Alexei Minayev from the Ministry of Economic Development.
The forum was attended by leaders of major global crypto exchanges such as Huobi and Exmo, as well as local crypto entrepreneurs, mainly representing Chinese Bitcoin (BTC) miners. The event also hosted a non-fungible token auction (NFT) organized by Binance NFT, an NFT platform and marketplace operated by the world’s largest cryptocurrency exchange.