Blockchain: Russians, Russians Everywhere

Blockchain is changing business worldwide, but did you know that most of the experts are Russian?

Leah Zitter
Read +
Follow Us

Sixty-five percent of my payment comes from Russia, which is why the FBI peeked into my affairs recently. Last month, W.U. refused to wire payment from Moscow to my American bank, and three months ago when it did, my bank huddled over it for two weeks. Around December, PayPal told me it shut down its Russian office. The only payment gateway that seemed to work was Upwork. Even Google Wallet, which previously helped me with Iraq, refused to make the transfer. All the same, I love my Russian clients. They pay me thousands of dollars and provide consistent work. They’re the ones who seem to make the innovative ICOs, create new tokens, cook up blockchain ideas.

So what is it about the Russians’ lovefest with blockchain?

For all the techno geekiness of crypto that most people find hard to understand, Russia is the one of the rare countries that has produced two A-listers in the industry: Vitalik Buterin of Ethereum and Pavel Durov of Telegram.

Buterin founded the second most famous blockchain platform after Bitcoin, Ethereum. Ethereum adherents insist it will outlive Bitcoin because of its smart contracts. Nine hours ago, the UK Independent reported that “Ethereum, Bitcoin’s biggest rival could become the world’s most valuable cryptocurrency”. Ethereum sets out to decentralize not just banks - as Bitcoin aimed to do - but the entire internet. From farming to government, people can sling assets from one another without a mediator and can revolutionize entire industries.

Ethereum founder Buterin in one of the industry's top figures (Image credit: Ethan Pines, Forbes)
Ethereum founder Buterin in one of the industry's top figures (Image credit: Ethan Pines, Forbes)

Durov created messaging app Telegram, which is currently building its own blockchain platform called the Telegram Open Network. Telegram, to those who have to become acquainted, is a cloud-based instant messaging service with 200 million monthly active users, as of March, 2018. ISIS highly recommended it to the terrorist group's supporters and members.

As of late last year, 20% of the top 50 blockchain startups by funds raised were Russian. They were either founded solely by Russians or had Russian partners, according to angel investor Elena Masolova. Not all of these innovators are ethno-Russians. Many like Buterin are expat-Russians, others are Russian Americans. But all have Russian roots. Most blockchain programmers are Russians, too. Every third or fourth blockchain blogger on Medium or Steem has a Russian-sounding name. Note, they don’t call themselves "gurus" or ‘experts” as Americans tend to do. Russians know their stuff. And they are hardworking, nit-picking, and humble in the process. My Russians are some of the most challenging clients to work for. They adore facts and appreciate hard work.

So why are the Russians successful?

"The reason is simple,” Masolova told Forbes contributor, Kenneth Rapoza. "You have lots of engineering talent and lots of cryptography talent in Russia. Plus you have a Russian economy that is not so great, so blockchain and cryptocurrency in general just looks like an enormous opportunity to entrepreneurs there," she said. Google was started by a Russian (Sergey Brin). Whatsapp was by a Russian too (Jan Koum). So was gaming giant ZeptoLab (twin brothers, Efim and Semyon Voinov). And the lesser-known Kolionovo Ecosystem, founded by a farmer for his Kolionovo village in Moscow.

Back to blockchain technology, famous Russians include Aleksander Ivanov, founder of the Waves Platform; Vasiliy Suvorov, a senior executive at Luxoft and one of the founders behind the Crypto Valley Association; Alex Fork, CEO of fintech firm Humaniq; Alex Fedoseev, CEO of 1World Online; Siberian-turned-Australian Sergei Sergienko, the CEO of ChronoBank; Igor Barinov, the blockchain priest at POA Network in San Francisco; and Sergei Ponomarev, CEO of the Supercomputer Organized by Network Mining company, to name a few.

There is also Pavel Lerner, poor blockchain analyst of EXMO LLP, who was kidnapped in Kyiv, last year. He was freed after paying the equivalant of  US$1,000,000 in Bitcoin.

You’ll find these Russian autodidacts zipping through Silicon Valley on special visas, dronign off at conventions, and huddling on projects with Americans. They are in Singapore and Barcelona. They are founders and top advisors. A majority of blockchain developers are Russians, as I discovered when conducting research for a blockchain development recruiting industry. You have to be really smart to program blockchain.

Back in Russia, President Vladimir Putin seems blockchain bonkers, too. He sounded Buterin on the technology, then promptly went and heralded a CryptoRuble - though critics say the digital ruble is as far from decentralized as anything. After all, blockchain is supposed to wrench money from government control, and this blockchain-based currency will be mined and produced by the government. Burger King Russia has also produced its Whoppercoin that you can eat or trade. You can either trade 1,700 Whoppercoins for one burger or hoard the coinsin your Whopper wallet.

“Now Whopper is not only burger that people in 90 different countries love – it’s an investment tool as well,” Ivan Shestov, head of external communications at Burger King Russia said in a statement. And while Russia has sullied its name for allegedly helping other countries with their voting systems, Holy Russia has made sure to sequester its own. In December 2017, Muscovites launched the blockchain platform, Active Citizen, where residents are allowed to cast votes for measures ranging from the name of their new metro train to the color of the seats in a new sports arena.

That same year, Putin reached for one-third of the world’s bitcoin mining network from China.

There's reason to believe Putin instigates some of this Russian blockchain bonanza. After all, Putin tells his followers stuff like, “Russia’s greatest asset is not oil and gas, but its people. Russia’s human capital is its most valuable resource.  Together, we will get to work on a great, massive scale, in the name of Russia.” Say what you will of Putin, he's got remarkable leadership skills. And he’s all out to wrap blockchain under his belt.

“The internet belongs to the Americans — but blockchain will belong to us,” a KGB agent told FinTech representatives of 25 countries in Tokyo, last year. Not all Russian techs are spies. They're all smart.