Russian President Vladimir Putin is making the headlines in the crypto world this week after he tentatively acknowledged that cryptocurrencies have value, but that it’s still too early to tell given their “unstable” nature.
In the future, they could be accepted as a legitimate form of payment, but it’s still early days, cautioned the President.
The news made the rounds early yesterday, Thursday 14 October, after CNBC interviewed Putin, and the Kremlin posted the discussion on its website (in Russian).
Even though crypto fans might start to feel a rush of excitement, thinking the Russian President defended digital currencies, it would be wise for them to hold back as Putin’s choice of words on the subject was very cautious.
The news rocket Bitcoin $62K for the first time in months.
When asked by CNBC whether cryptocurrencies might be used instead of dollars for contracts to supply oil, Putin answered “Cryptocurrency contracts? It’s too early to talk about this, because cryptocurrency, of course, can be a unit of account, but it is very unstable.”
He continued “In order to transfer funds from one place to another, yes, but to trade, let alone trade in energy resources, in my opinion, is still premature. The cryptocurrency is not backed by anything yet. It exists and as a means of calculation can be used, of course, yes, but trading in oil, say, or other primary materials and energy sources – still, it seems to me, it’s too early to talk about this yet.”
He ended on a more positive note, “But everything develops, everything has the right to exist. We will see how it will go further, maybe someday it may also be a means of accumulation. We see this market fluctuate. It’s a bit early today.”
So even though Russia still appears to be open to discussing cryptocurrencies as a means of payment, we’ll just have to wait and see what happens down the line.
Given the fluctuating behavior of crypto, certain countries have been reluctant to jump all in. Looking at this year alone cryptocurrencies like Bitcoin have dipped and gone back up in a space of mere months. In February Bitcoin went over $50K for the first time ever, only to drop below $32K in May, before jumping back to over $60K this month.
Countries like China have cracked down on digital currencies, making all cryptocurrency transactions illegal as of last month.
Time will tell where Russia truly stands on that line, but for now, we’ll have to wait.