YEREVAN, APRIL 11, ARMENPRESS. Armenia’s government, declaring the development of technological field as a priority direction, also attaches importance to the development of blockchain technologies and their installation in different branches of the economy. Having a vision to create its own product in this field and propose it to the world, the Armenian Blockchain first international Forum is expected to be held in Yerevan. On April 22 the leading international figures of the field - more than 600 participants from different countries, including the USA, Ireland, China, Switzerland, Ukraine, Russia, Georgia, Canada, as well as Armenia, representatives of more than 30 investment funds and angel investors will gather at the TUMO Center for Creative Technologies, Emil Tarasyan – deputy minister of economic development and investments, told ARMENPRESS.

“Blockchain is a new technological trend, and countries compete in this field to propose more interesting solutions, and Armenia’s goal is to move forward with realistic steps. We aim at understating how we can improve the public services by the use of blockchain technologies, what advantages and impact their use will have, starting from optimization to ruling out possible corruption phenomena in the services provided in the public sector. It will be a good chance for our startups to meet with potential investors”, the deputy minister said.

The forum will consist of four parts: in the first part the world experience of blockchain technologies, in connection with legal regulation mechanisms, smart contracts, will be presented, in the second part of the forum lectures on blockchain technologies and their use will be organized, as well as the existing educational and acceleration programs in the field will be introduced. There will be a separate hall for investors-business circle-public sector communication, and the Armenian and foreign startups will present their developments by the use of blockchain technologies at a road-show format. The jury will select 15 startup-idea which will receive funding and will be able to create their own product and will target also the world market in addition to the Armenian one.

“As a ministry of economic development and investments, we attach a great importance to the progress of innovative solutions and new technologies, as well as their promotion. For this purpose we need to understand the problems facing the companies operating in this field, in connection with the legal field, ecosystem gaps. And we must fill these gaps through investment and already specialized companies”, the deputy minister noted.

Blockchain technologies are used in all spheres of life when transactions or registrations are being made, for instance, in cadastre, notary systems. “The self-regulatory and validation system is being done between all participants which also increases the level of trust towards that system as the anti-corruption manifestation and the interference possibility reaches zero”.

Some countries already use the solutions based on this technology in their administration systems. Armenia’s digital agenda provides a great field for the use of these technologies in the country. “For its use it’s very important for Armenia to have an ecosystem, only its installation is not enough, we should have organizations which will not only install them, but will serve these systems, as well as will create new products that will be exported to other countries”, Emil Tarasyan noted.

Cryptoassets (cryptocurrency)

Blockchain technologies are also used for approving and registering transactions with cryptocurrency, as well as generate them. Emil Tarasyan called this phenomenon “cryptoasset” because different countries give different definitions. “One country views it as a product, the other as a property right to that product, another one considers it as a currency, and there are countries which view it as a digital asset. There are different approaches, but this market also started developing international standards. Compared to an ordinary currency in which case there are common international standards, cryptoasset and platforms designed for it do not have common standards, but the latest developments lead to the fact that platforms are being united across certain standards”.

Having the component of anonymous transactions, cryptoassets or cryptocurrencies are attractive for those who want to hide their own money, therefore, they contain many risks. Moreover, it also raises the problem of the protection of consumer rights. The business of people having cryptocurrencies can close in a day, and they will lose all their money. “They cannot appeal to the court as de jure they have no right towards that cryptoasset they have acquired, but they de facto have lost concrete sums. Therefore, many countries move on the path of ruling out anonymous transactions. We need to understand what regulations exist in general since while regulating the technological field the over-regulation results in technological stop, but non-regulation in general contains risks of not ensuring investments and progress. By using the format of the forum we must be able to understand what regulations can be applied”, he said.

As for the private initiatives on creating a crypto-mining center in Armenia and rumors according to which a free economic zone will be created for that purpose, Emil Tarasyan said this can be one of the solutions. “Armenia had working discussions on this issue with different beneficiaries. Maybe we will go to regulation by a new model, whether it will be free economic zone, or other format, is still unclear. If there is a demand, we are ready to present a proposal. This is one of the ways which must be discussed during the forum when its business model and technical solutions are presented”, the deputy minister noted.

Regulation approaches

Armenia’s finance ministry, as well as Central Bank are carefully following the developments in the cryptocurrency field. They say it’s difficult to welcome a phenomena to an economic life which is being created by algorithms, and in the final result there is no one who bears responsibility for that.

Nevertheless, the discussions on regulating the crytocurrency field become more relevant, and Armenia as well is engaged in it. As finance minister Vardan Aramyan told ARMENPRESS in February, 2018, when cryptocurrency enters the economic life of any country, and when it is impossible to stop the process of any procedure, it must become manageable. “There are discussions at various formats. Different countries have different approaches on this issue. Some view it as a financial asset, some  - as a financial asset and a payment measure. I think sooner or later we need to take into account this phenomenon and make the risks manageable. There are views according to which the cryptocurrency field must become manageable, and it is necessary to create a platform which will generate additional revenues for the state”.

Head of the financial system regulation department at the CBA Mher Abrahamyan told ARMENPRESS in December, 2017 that the world, including Armenia, is still at the stage of recognition, study and monitoring of the cryptocurrency field with more than 1000 types. “Actually, cryptocurrencies are a new phenomena in our lives. Most of the countries do not yet have a final stance in terms of its regulation and control. Some countries make various attempts, some regulate them, some ban, and some countries warn their citizens, consumers about the great risks linked with cryptocurrencies and urge to refrain from possible risks and losses”. The Central Bank’s position has not changed during these months.

Interview by Ani Nazaryan

English –translator/editor: Aneta Harutyunyan