Russian Legislation – Legalization of Crypto Mining
Russian President Vladimir Putin has officially signed a law that legalizes cryptocurrency mining in Russia. According to reports from TASS, the Russian news agency, the law introduces several key concepts, including digital currency mining, mining pools, and mining infrastructure operators. Mining activities are now considered part of Russia’s economic turnover rather than the issuance of digital currencies.
The new legislation stipulates that only Russian legal entities and individual entrepreneurs registered with the government are allowed to engage in cryptocurrency mining. However, individual miners can participate without registration, provided their energy consumption remains within the limits set by the government. This provision allows small-scale miners to continue their activities without formal registration, while larger-scale miners will be subject to stricter controls.
Additionally, the law permits the trading of foreign digital financial assets on Russian blockchain platforms. However, if certain assets are deemed to pose a threat to the country’s financial stability, the Russian Central Bank has the authority to prohibit their holding.
Russia has officially legalized cryptocurrency mining, marking a significant shift in the country’s attitude towards digital assets. The new law, signed by President Vladimir Putin, introduces a comprehensive legal framework to regulate cryptocurrency mining and define the rights and obligations of those involved in the industry. Published on Russia’s official legal information portal, the law clarifies the previously unregulated cryptocurrency mining sector.
According to TASS, during a recent government meeting, President Putin emphasized that Russia needs to “seize the moment” to establish a legal framework for digital currencies. He highlighted the potential of digital currencies for Russia’s economic development and the need for appropriate regulation and infrastructure.
The law will be officially published in November 2024 and will take effect ten days after publication, though the implementation dates of specific provisions may vary.
Crypto Mining in Russia Before the Legislation
Before this legislation, crypto mining activities in Russia operated in a gray area. Due to low electricity costs and sanctions against the U.S. dollar payment system (SWIFT), more Russian companies and households turned to mining and trading digital currencies to bypass financial sanctions. BTC mining was particularly common, especially in the Irkutsk region. The cold temperatures in Russia demand high standards for the cold start of mining machines, making the MicroBT Whatsminer series, known for its exceptional stability, particularly popular among local miners.
Impact of the Legislation
By legalizing mining and imposing corresponding restrictions, the legislation aims to prevent chaotic and unrestrained energy consumption. This move underscores the government’s cautious approach to digital assets, balancing the need for innovation with the protection of the financial system.
The legislation also imposes strict controls on the advertising and promotion of cryptocurrencies. The bill prohibits the offering of digital assets to the general public, likely to prevent the widespread promotion of potentially risky investments. Additionally, the law allows for the prohibition of cryptocurrency mining in specific regions or territories, providing the government with flexibility in managing the industry based on local conditions.
President Putin has stressed the importance of regulating cryptocurrencies and digital assets, considering them a promising area for economic development. In a recent government meeting, he emphasized that Russia needs to “seize the moment” and establish a strong legal framework to support the growth of digital assets in both domestic and international trade.
