A Russian lobby group has run out of patience waiting for cryptocurrency regulation and has decided to formulate its own regulatory group to deal with disputes.
The Russian Union of Industrialists and Entrepreneurs (RUIE) normally lobbies for the cryptocurrency sector regarding regulation and fintech infrastructure but has now taken another step further by forming an arbitration group.
The group will extend the breadth of its usual scope and attempt to handle disputes arising from cryptocurrency transactions, smart contracts and token sales. In order to deliver an efficient and informative service, the RUIE has called on expert advice from with the sector.
The main problem appears to be the volume of cryptocurrency queries and disputes jamming Russian courts. A recent example involved a church in Irkutsk, Siberia’s largest state, which was taken to court for draining too much power from the local grid through crypto mining. In another major case, the St Petersburg City Court lifted a block on crypto media website Bitcoininfo.ru, after the District Court shut down its site in July 2016.
The same St Petersburg court annulled a trial court decision to ban 40 other Bitcoin-related websites, previously accused of spreading information about digital currency that “is not backed by any real asset and does not provide information about its owners”.
The Russian government is reviewing cryptocurrency regulation under the Digital Assets Regulation Bill filed on 25 January. The bill defines cryptocurrencies and tokens as digital financial assets. If the bill passes in its current form, it would allow trading on cryptocurrency exchange operators with authorized Know-Your-Customer (KYC) standards. This would also apply to initial coin offerings (ICOs) established in Russia.
Until then, bodies such as RUIE can certainly plug the gap left by regulators’ standoff approach to dealing with disputes needing some kind of arbitration. However, appeals do continue to find favor with the courts. The new body claims that it will have a broader remit settling disputes across the whole crypto sector although will have no recourse to changing current laws pertaining to cryptocurrencies.
The body will convene for the first time early next year.
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