Moscow’s first international FinTech cluster, Future FinTech, sponsored by Blockchain Community and venture capital fund Deep Knowledge Ventures among others successfully launched October 29. CoinTelegraph spoke to bits.media Founder Ivan Tikhonov about the importance of the event, its potential to change the Russian FinTech climate and the current legislative situation in Russia.
Located above the headquarters of disruptive banking provider iBank, which also sponsored the event, the cluster brought together startups, investors and funds to exchange ideas and build relationships in a relaxed atmosphere.
The concept was born out of the increasing potential organizers see in the Russian market for progress in the FinTech sector.
“As a strategic partner we're seeing players emerge in the modern FinTech business, and it's not just banks,” Alex Fork, President of Future FinTech and author of the first Russian book on Bitcoin, said during a keynote presentation at the event. “Now in the finance sphere there are mobile operators, internet companies, payment providers, insurers and trading outfits.”
The cluster itself focused on playing four key roles designed to extend beyond the day of the event itself. Incubator and accelerator assistance projects were unveiled for startups, helping them achieve specific goals over a two-month period. Co-working groups were also available, as well as FinTech events including a hackathon.
“We consider FinTech cluster as an innovative center of concentration of technology, knowledge, and resources of the community, with an emphasis on peer-to-peer projects, blockchain, machine learning and artificial intelligence,” Deep Knowledge Ventures partner Dmitry Kaminsky said.
While the climate for blockchain and disruptive financial technology in Russia has been stormy, the event marked something of a turning point in appetite to bring Moscow in line with the wider tide of innovation around the world. Similar clusters are set to be opened in India and the Middle East, while in 2016 the Moscow cluster will be integrated with existing structures in Hong Kong, London and New York, Russian Bitcoin resource bits.media reports.
CoinTelegraph: What was the reaction to the event like? Was there support or criticism from unexpected places?
Ivan Tikhonov: First and foremost it was born out of interest. The event attracted many journalists and experts, since the opening of an offline fintech platform is a big event.
Of course there were doubts and questions. Will the team and funding be sufficient? Aleks Fork commented that there are already 4 mainstay projects, there's already funding from DKV and discussions are currently being held with other potential investors, along with applications from teams being accepted.
In general feedback was supportive - many people are interested in this area, or at least in the project, and are able to help grow it.
CT: How do you gauge the atmosphere for FinTech innovation in Russia currently? Is there an opportunity for blockchain-based disruption to get a foothold or is the climate still too uncertain?
IT: I don't see any problems with the development of blockchain or FinTech technology. Yes there still exist plenty of questions and challenges regarding cryptocurrencies like Bitcoin, but when it comes to the blockchain both regulators, among them the Russian Central Bank, as well as associated businesses, are speaking rather about benefits. I think we'll soon be seeing practical applications of these decisions, most likely starting with high-tech companies such as QIWI, which are researching and considering innovative solutions.
“[W]hen it comes to the blockchain both regulators, among them the Russian Central Bank, as well as associated businesses, are speaking rather about benefits.”
It doesn't have to be cryptocurrency which is built on the blockchain; various systems are possible. As I see it, the main problem in Russia is the framework. Good specialists are leaving to work abroad. It'd of course be good to see more governmental support in this area.
CT: What is the idea behind the international integration of the cluster? What benefits will it bring in practice do you think?
IT: The same as what the internet brought with it. Accelerate information exchange, make joint participation possible from experts in different countries, searching for projects which can help each other grow - ideally it should be about synergy. The international cluster enables better control of resources.
CT: What do you think about BitRuble and how it could impact on development of FinTech in the Russian industry?
IT: BitRuble is an interesting experiment. It's hard to say what the results will be, but even the fact it was announced is very interesting. I hope QIWI can find some sort of compromise with regulators, as it would serve as some form of starting point for legal cryptocurrencies in Russia. A lot of companies would like to work with cryptocurrencies here, but while there's been no resolution from the Central Bank, they're holding off.
CT: MinFin recently announced a plan to jail Bitcoin users for up to 4 years. What are the chances of this being made law?
IT: MinFin did announce that they want to hand down up to four years' jail time, but for one particular crime - exchanging cryptocurrency for rubles. This legal package has been in the works for 1.5 years already, with representatives of various departments giving various deadlines for when it should be adopted, but so far nothing's been done, so it's hard to say whether it's a real threat or not.
“No one knows what the legal framework will look like ultimately […] We can only say one thing with confidence: that it will scare away investment, and those who want to develop similar businesses in Russia.”
Moreover while there's still no post-revision version of the law available, which is free from any possible changes following its adoption, it's difficult to talk about it categorically.
CT: If prosecution is only likely for bitcoin to ruble conversion, is it possible to exchange BTC for dollars then dollars for rubles? Or will BTC need to be exchanged for dollars abroad, then exchanged for rubles in Russia?
IT: No one knows what the legal framework will look like ultimately, should such a law be adopted. We can only say one thing with confidence: that it will scare away investment, and those who want to develop similar businesses in Russia. They'll leave to do business in countries with more supportive regulation - and there's already plenty of choice.