Why Exceeded Bitcoin's Putin Could Be Dangerous

Alexei Nawalny is considered a figurehead of the Russian opposition. With a prison term of 30 days, he was in the focus of the public in June because, according to a Russian court, he has repeatedly violated the right of assembly. Already in March he was sentenced to 15 days in prison.

Alexei Nawalny

He was also sentenced to five years' imprisonment in February because of embezzlement. In this way he has no right to compete in the presidential election next year. Nawalny, on the other hand, claims that he was only condemned to give him the chance to take the presidency.

Russia's opposition relies on Bitcoin

It is this prehistory that must be known to better understand why a further step in Nawalny is contributing to the concern of Vladimir Putin. The authorities in Russia seem to want to make it difficult for the challenger: allegedly in Russia the accounts of the opposition are blocked, which is why it is difficult to receive donations.

But Nawalny has found a way out. He receives donations via bitcoins, which means he can bypass such bank account blocking. "Our campaign is funded by Crowdfunding," says Leonid Volkov, an employee of Alexei Nawalny, the digital magazine t3n.de. A total of 1.3 million euros had been invested in this way, of which about 15 percent via Bitcoin. A sum that surprised the opposition itself.

No expansion of the campaign planned for other cryptos

Volkov claims in the conversation that her bank account has already been blocked twice - and also her Paypal account. "Only at Bitcoin did we have uninterrupted access to the money so far," said the employee Nawalnys. The bitcoins would be exchanged immediately in rubles, whereby the campaign with about 138 donated Bitcoin received around 12 million rubles. If the opposition had not yet exchanged the digital coins, they would now be almost double the price.

The Campaign is not to be extended to other cryptanages. The share of, for example, ethers would probably be even smaller than the 15 percent donated via Bitcoin. As a result, management of another digital currency is not worthwhile, explains Volkov.

Nawalny has some hurdles to cope with

A problem, however, is the time factor. In December of this year officially launched the election campaign in Russia. From this point onwards, only funds can be accepted which prove that they did not come from abroad. This is impossible for Bitcoin donations, according to Volkov.

And whether Nawalny is allowed to start anyway is not clear yet. On the one hand because of the imprisonment, on the other hand it requires 300,000 signatures to be admitted - however demonstrably from all regions of Russia. Should he still be admitted, Nawalny will be given only minimal chances for a real electoral victory.

But with all the hurdles that Vladimir Putin puts in the way of the challenger, he does not seem to take the candidate lightly. Putin still has no prescription for the Bitcoin donation collection - and probably will not find any. Thus a politician, against whom the government apparently proceeds, shows what possibilities can be opened up with cryptic methods.