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Virtual currency is already in real banks. And they spend it

Oleg Koldaev, Catherine Lange

The banking business is afraid of everything new. The price of risk is very high - the money of depositors. However, the crypto currency is step by step gaining the confidence of credit institutions. In Western Europe and the US, businessmen are already seriously considering the crypto as a liquid asset. Many financial structures use digital equivalents of value in money transfers and mutual settlements. "If there was not a lack of a regulatory framework, our banks could have made bitcoins the content of investment portfolios," said Timur Aitov, deputy chairman of the Russian Subcommittee of Chamber of Commerce and Industry for Payment Instruments and Information Security for Bitnewstoday.com.

I want to start with the main thing: can cryptocurrency be a bank asset?

Undoubtedly it can. And maybe even replace and supplement the fiat money. But only if it is issued by an authorized organization. Unfortunately, so far there is no corresponding regulatory framework. But if the legislation will suddenly appear, why not?

Probably, because there is already a popular opinion: that cryptocurrencies are dangerous?

Speaking about the dangers of cryptocurrency, many are trapped in myths. For example, anonymity. Digital payment instruments are no more anonymous than paper money. Perhaps, cash has the highest level of anonymity. Tokens still allow you to track their movement from one owner to another. I will remind you: when recently in Japan the large robbery of crypto-instruments has happened, all the owners of bitcoins recieved a message that the "coin" was stolen. And the buyer had the opportunity either to return it to the rightful owner, or to live with the thought that he uses stolen money.

Tracking the movement of cryptocurrency is much easier than paper money`s one .There is another example, it`s a whole country, Venezuela. President Maduro launched the project of the national cryptocurrency El Petro, while declaring that the "coin" will be provided by the present and future deliveries of oil to the world market. The filling of this coin, by the way, peacefully coexisting with the national monetary unit, immediately became attractive to investors. In fact, Maduro held the first national ICO. And this project has already brought about $ 4 billion. There is no anonymity, all investors are identified. Every person or organization that invests money into the cryptocurrency will be able to freely convert it into fiat money. So, examples, when the cryptocurrency becomes an official financial tool, already exist.

President of Venezuela Nicholas Maduro on Thursday said that the national currency of the Bolivar will be "tied" to the cryptocurrency (El Petro), issued in February 2018. In spring, sales of housing for El Petro started. The Central Bank of Venezuela actively buys gold of citizens and organizations for cryptocurrency.

Everything is clear with Venezuela. But if we talk about classical cryptocurrencies, what parameters will be taken into account when determining the value of this asset?

Today, we see that the cost of bitcoin changes on the basis of trading on various cryptoexchanges. By the way, a big volatility of this currency is connected with this. Its` cost broadcasts directly from the exchange to the course in blockchain.

But, at the same time, behind any digital equivalent, you can "put" the cost associated with other tangible assets.

Some foreign banks already use cryptoinstruments in their activities. For example, Citicoin that is a "child" of Citi-bank, is actively used when working with fiat money, their movement between branches. For each unit of Citicoin, the value associated with the amount being transferred in dollars is digitally fixed.

And in Russia, credit institutions own cryptocurrency? Are there precedents?

Russian banks are one of the most innovative in the world. By this parameter they are in the top 5 European banks, according to the consulting agency Deloitte. But at the same time, they are also law-abiding: they are waiting for the appearance of an appropriate regulatory framework. A single package of laws that regulates cryptomarket should be considered before July 30. But if the legislators do not succeed, because the content of the projects has been radically changed from the first reading to the second, then we are waiting for the autumn session.

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