Russia’s Crypto Mining ‘Legalization’ Bills Could Be Approved ‘This Week’

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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July 23, 2024 19:30 EDT

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Russia may legalize industrial crypto mining by the end of the week, media outlets in the nation have claimed.

Interfax reported that the State Duma passed a third reading of a draft law that would force crypto miners in the Russian Federation to “comply with the requirements of anti-money laundering legislation.”

Russia’s Crypto Mining Law Could Come into Force on Sep. 1

The law is now set to be ratified by the upper parliamentary house. It will then be signed into law by the President’s office.

If it passes, miners will need to report information about suspicious-looking crypto transactions to Rosfinmonitoring, the nation’s anti-money laundering agency.

However, this law appears to be the tip of a larger iceberg. The same media outlet explained that the State Duma held the first reading for a crypto mining “legalization” bill on July 23.

If passed, this bill will “legalize digital currency mining activities in the Russian Federation from September 1, 2024.”

Vedomosti, meanwhile, reported that the Duma is now poised to “pass a law on cryptocurrency mining in the coming days.”

The media outlet quoted one of the bill’s authors, the lawmaker Anton Gorelkin, as saying the draft law will be “fully adopted before the end of the Duma’s spring session.” The Duma’s current session wraps up on August 5.

Gorelkin said that a “package of amendments” for the bill’s second reading “has already been formed, to all intents and purposes.”

However, Vedomosti also quoted an anonymous source “close to the State Duma” as claiming that the bill “could be adopted in full by the end of the week.”

‘Time to Regulate Crypto’ – Top Parliamentarian

Another top lawmaker has also confirmed the long-awaited legislation is finally ready for a vote. This follows over two years of deliberations.

TASS reported that the Chairman of the State Duma’s Committee on the Financial Markets, Anatoly Aksakov, explained:

“We expect to adopt the bill in the first reading [on July 23]. This follows an order from the President. We are now working closely with the government, preparing bills for the second and third readings. We expect that within this parliamentary session we will adopt the laws that will regulate [the crypto sector].”

The bills could also contain clauses pertaining to crypto exchanges, which could be banned from operating in the nation outside a regulatory sandbox.

They could also provide regulations for Russian firms who want to use crypto as a payment tool in cross-border trade.

“Sooner or later, Russian economists will have to return the Russian economy from the military interventionism model to some form of normality—or, as the reformers joked in the early 1990s, to ‘make an egg out of an omelet.’”https://t.co/p1VSc4vWTi

— Foreign Affairs (@ForeignAffairs) July 23, 2024

Putin Wants Crypto Progress

Aksakov was speaking in the wake of crypto mining-related comments from President Vladimir Putin.

Putin has called on lawmakers to fast-track crypto mining regulation. While the Central Bank has previously proposed banning crypto mining, the industry has ballooned in value in recent months.

The fate of private miners currently appears to remain unclear. Several proposals have already been floated, including banning all non-industrial mining.

The government has also proposed alternatives, including allowing power companies to “hunt” and prosecute private miners.

A more lenient approach has also been floated. This would allow miners to operate from home, as long as they do not exceed fixed energy consumption thresholds.

A final option could see lawmakers avoid regulating for private miners at this stage, and returning to tackle the subject at a future session.

Russia’s bitcoin addiction is leading to electricity shortages https://t.co/vhkNdSUaNJ

— Izabella Kaminska (@izakaminska) July 17, 2024

Industrial Miners: Reason for Cheer?

Industrial miners will likely welcome the news, however. Although the new laws will mean they have to abide by AML protocols and pay taxes on their earnings, they will likely gain “official” recognition as business operators.

This will open the door for domestic investment in what has become one of Russia’s fastest-growing business sectors.

Aksakov noted that “representatives of the mining industry” and people “who actively use cryptocurrency” have asked Moscow to “regulate the sector at the legislative level.”