Russia to Create ICO Investment Protection System

The first system of guarantees for investing in cryptocurrencies will appear in Russia as early as this year, Moscow-based Izvestya newspaper reported.

The subsidiary bank of VEB – the Globex state corporation – together with the Russian Association of Cryptocurrency and Blockchain (RACIB) and the CrowdHub Internet platform, are creating a system to protect investment in Initial Coin Offerings (ICO). The new project will make it possible for investors to control the fund’s expenditure. Payments will be made in stages in line with approved plans to develop startups, the report says.

RACIB Director Arseniy Shcheltsin told Izvestya that work was in progress to create an ICO hub whose main element would be a system of guaranteed investment in cryptocurrency startups. Its operation will be based on the CrowdHub platform (a joint project by RACIB Vice President Denis Dushnov and the association).

This information has been confirmed by Head of the Department for the Development of E-Commerce and Remote Banking Services at Globex Alexander Mineyev. “We expect the project to be launched in April, and later on a further development of its strategy will begin,” he said.

The use of escrow accounts for ICOs does not only guarantee that parties comply with the joint obligations, it also minimizes risks for transaction failure or fraud, said Mikhail Lapin, Head of the Project Department at Bell Integrator. The participation of a state-run bank in the project is a good signal for the market, according to Murad Salikhov, Chairman of the Supervisory Board of Bank Voronezh.

The absence of cryptocurrency legislation in Russia should not prevent market participants from creating their own standards and rules of conduct, which do not violate the existing legal norms, said Lenam Rakhamnov, co-founder of the Statum Cryptocurrency Fund. “On the contrary, this type of activity contributes to the creation of a balanced legislation in this area,” he pointed out.