Putin Aims to Isolate Russian Internet With New Law

On May 1, President Vladimir Putin of the Russian Federation signed a law that would isolate Russia from the traditional internet. The law will become effective as of November 1, 2019, and cost at least 30 billion rubles (~$485 million).

The law is supposed to ensure the stable operation of the Russian Internet (Runet) in the even that hostile foreign powers disconnect the country from the global internet infrastructure, local media outlet Tass reports. The law empowers the Roscomnadzor to exercise centralized control over the Russian segment of the internet, according to the document published on the official Russian portal for legal documents. To put it simply, internet service providers will have to disconnect from foreign servers and filter traffic through the nodes controlled by Roscomnadzor once the government decides that something threatens the sustainable functioning of Russia’s internet. The operators will test the system later this year.

On The Hook

The authorities insist that the new law is intended as a measure aimed to protect Russian Internet users amid escalating tensions between Russia and Western countries. Thus, the head of Roscomnadzor Alexander Zharov compared the law to a nuclear weapon that remains dormant which everyone hopes is never used. This controversial law has stirred up discussions both within the country and abroad. Critics believe the main objective of the initiative is to increase government control and censorship over what can be viewed on in the internet. While the technical aspects of the law remain unclear, it will make it easier for the authorities to block banned and blacklisted websites and internet-based services like the messaging app Telegram and VPN services. Eventually, this would lead to tighter restrictions on freedom of speech and could potentially trigger the realization of a situation similar to China.

What Does It Mean for Cryptocurrency Users

If the Iron Curtain falls down, Russian cryptocurrency users could also be affected. Total control over internet traffic will make connections slower and create a permanent threat in the form of a filter on all incoming and outgoing traffic. Moreover, the government may tighten its grip on cryptocurrency-related businesses. For example, by allowing cryptocurrency trading only for investors it deems qualified and only through locally authorized exchanges. However, if history is any guide, the prohibitions won’t reduce the demand for cryptocurrencies, but rather create a black market and stimulate underground trading. This is what happened in China and Venezuela, where citizens are opting for Bitcoin (BTC) to escape governmental control and censorship. Moreover, these restrictive policies will scrap all efforts to support technological development and innovations in the Russian economy. What do you think of Russia’s attempt to isolate its internet? How might it affect the local cryptocurrency industry? Let us know what you think in the comments below.