Russia unlikely to impose blanket ban on cryptocurrencies, says Deputy Finance Minister

Russian law currently bans the issue of any currency, including virtual money, not approved by the Central Bank of Russia. The country's Finance Ministry has been working on new legislation to support the ban with criminal responsibility stipulating prison sentences of up to seven years.

"The legislation is ready, but we will not rush it through and it is likely to be altered. I now want to hold meetings with experts and once again consider our options. Given the development of technology, any blanket ban is probably not worth implementing," Moiseev told reporters.

In July, Moiseev said that the ministry is working on legislation aimed at equating bitcoin, which is world's most widely used cryptocurrency, to foreign currencies, thus prohibiting its issue on Russian territory.

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Most transactions involving bitcoins are linked to criminal activities, including extortion, money laundering and terrorism, Moiseev warned

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At the same time, he stressed that legal transactions should be not be hindered and the new legislation must be written with this in mind.

Virtual currencies are issued privately, and are stored and transacted electronically. Currency units of electronic nature vary from currency denominated in legal tender, such as PayPal and WebMoney currencies, convertible IOU (I owe you) coupons, non-convertible credits used in online games and hundreds of cryptocurrencies including bitcoin, ripple and litecoin. Russian authorities have treated the phenomenon with caution, while Russia's Central Bank has received a number of proposals for creating a Russian national cryptocurrency.