Moscow Moves Closer to Legalizing Industrial Crypto Mining
Moscow is on the brink of legalizing its flourishing industrial crypto mining sector, thanks to persistent lobbying efforts from major Bitcoin miners in Russia. According to Izvestia newspaper, the finance ministry is prepared to approve a draft bill that would officially recognize mining as a form of entrepreneurship.
If the State Duma gives its approval, miners will be required to pay taxes on their earnings and potentially face higher energy costs. Despite these new financial obligations, most industrial miners in Russia welcome the move as it would lift their industry out of the “grey” sector where it currently resides.
Currently, crypto has no legal status in Russia, with the only existing crypto-specific law banning its use as a form of payment. The proposed bill aims to include “the mining of cryptoassets” in the government-recognized list of business activities, providing miners with much-needed clarity and security.
The Ministry of Energy is considering creating a new classification code for miners or adding them to an existing category within the All-Russian Classifier of Economic Activities (OKVED). The finance ministry has indicated its willingness to grant miners OKVED recognition, a move that could align with the industry ministry’s suggestion of classifying mining as a form of manufacturing-related activity.
Despite previous calls from the Central Bank for a ban on crypto, recent years have seen a shift in their stance. While still hesitant to embrace crypto adoption, the bank is now open to allowing cross-border trade firms to use Bitcoin and other tokens as payment tools under its supervision.
The industrial mining sector in Russia has seen significant growth, with miners attributing this to low energy costs and favorable climate conditions. Some industry leaders claim that the sector, which primarily focuses on Bitcoin mining, is now second in size only to the United States.
As the industry eagerly awaits regulatory clarity from Moscow, investors are also monitoring the situation closely before deciding to support Russian mining firms. The proposed bill is expected to provide a legal definition of crypto mining, addressing the absence of such regulation in Russian legislation.
Overall, if a compromise is reached between the Central Bank and pro-business government officials, industrial miners in Russia could finally operate within a clear regulatory framework, paving the way for further growth and development in the sector.