Escrow accounts offered as a measure to protect ICO investments of Russians

As repeatedly noted by Vitalik Buterin who created the second most popular cryptocurrency, the current mechanism of initial coin offerings (ICOs) is very far from ideal. His main concerns are the lack of consumer protection and of the certainty that project founders will indeed fulfill their obligations. The Russian Association of Blockchain and Cryptocurrency (RACIB) together with the state-backed VEB bank offers a possible solution.

ICO startups’ escrow accounts are proposed to be established in one of the VEB’s subsidiary companies. The new CrowdHub platform will have a mechanism through which the project investors may vote for the project termination and funds withdrawal in case they think some fraud tactics are involved.

The new Russian legislation designed for ICOs and cryptocurrencies is still not implemented, but it’s going to happen relatively soon - in summer this year. In the best possible outcome, the crypto trading legislation will resemble that of South Korea, but the draft version previously described by Bitnewstoday and made by the FinMin has some strict opposers in the Central Bank.

On the local level, governors and officials continue to assess the possibilities of the new market. For example, Anton Alikhanov, one of the youngest governors in the country, proposes to make the Kaliningrad Oblast a big and regulated mining farm so that no amateurs burn their house down in pursuit of easy money. Having some experience as a trader, Mr. Alikhanov himself rejects to trade with cryptocurrency assets - he prefers to wait before the market becomes more stable.