A senior Finance Ministry official in Moscow sees no point in banning crypto mining in Russian households as it would be difficult to restrict the activity. The senior official also revealed that the department is currently finalizing regulations for the mining sector as part of efforts to legalize Russia’s crypto space.
Russia prepares to legalize cryptocurrency mining
Trying to ban home-based crypto mining makes no sense because it would be difficult to impose such a ban, according to Alexey Yakovlev, deputy director of the financial policy department at Russia’s finance ministry. He made the statement during a panel discussion on the legalization and regulation of the industry.
The ministry is in the process of finalizing new provisions that would bring this crypto-related activity into the legal realm, Yakovlev said in a videoconference, as quoted by crypto news outlet Forklog. The Russian authorities intend to focus on ensuring that the sector’s activities are economically feasible.
The government also wants to minimize potential risks. Elaborating on this point, the Minfin representative highlighted the threats of money laundering and terrorist financing. He also stressed the need to ensure the energy security of the Russian Federation.
Cryptocurrency mining in basements and garages has become a popular source of income for many ordinary Russians, especially in areas like Irkutsk where household electricity rates start at just $0.01 per kWh. Electricity consumption there quadrupled last year and authorities believe the rise is largely due to mining equipment running in people’s homes and villas.
In December, the central government in Moscow allowed Russian regions to locally determine electricity tariffs in residential areas. This will allow regional authorities and utility companies to introduce higher tariffs for household consumption above certain thresholds.
Amid unprecedented Western sanctions, Russia continues its efforts to regulate its crypto market, seeing an opportunity to use crypto assets to restore its access to global finance. While its central bank has been a vocal opponent of legalizing crypto-related activities, including mining, the finance ministry has led a campaign to regulate them under strict supervision.
In January, President Vladimir Putin urged the two sides to resolve their differences, pointing to Russia’s competitive advantages as a bitcoin mining destination. Calls have grown among officials in Moscow and energy-rich Russian regions to recognize mining as a business activity. This week, the Ministry of Energy insisted that the legal vacuum in the sector be filled “as soon as possible”.
In February, the federal government approved a regulatory plan based on the concept of the Ministry of Finance. Shortly after, the department introduced a new “On Digital Currency” bill designed to comprehensively regulate the crypto-economy after the “On Digital Financial Assets” law, which came into force last January, n addressed only certain regulatory aspects.
Do you expect Russia to legalize and regulate crypto mining as an economic activity soon? Tell us in the comments section below.
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