ICO mania goes mainstream in Moscow
Cryptocurrencies are still not legal in Russia for now, but that isn’t stopping businesses from preparing to take hold of the future.
Moscow’s ambitions to become an international financial centre may have come unstuck in 2014, but the city is rapidly becoming a preeminent global hub for a different type of finance.
A recent study cited by Quartz named the Russian capital as the top city for initial coin offerings (ICOs) last year, based on the location of the chief executive or founder of the fund-raising company, well ahead of Silicon Valley. This is all the more impressive given that ICOs remain illegal in Russia itself.
Of course, in some ways this is a fairly dubious distinction, given the dicey reputation of ICOs. Russia’s official cryptocurrency and blockchain association estimates that at least half of the $300 million raised in ICOs last year went to scammers.
Part of the problem is that, despite the unparalleled enthusiasm of Russians for crypto schemes – around half of all ICOs globally are thought to involve some Russian participation – the sector is entirely unregulated.
Now, however, various entities from both the public and private sector are trying to bring some order and transparency to a chaotic market.
First and foremost is the Russian government, which is expected to pass long-awaited legislation regulating the sector this autumn.