By Anjali Kochhar
Russian President Vladimir Putin has officially signed a bill into law that will regulate cryptocurrency mining in Russia, effective from November 1, 2024. The new legislation, signed on August 8, marks a significant step in defining the country’s approach to digital currencies and mining operations.
Under this law, the Russian government, in collaboration with the Bank of Russia, will oversee and enforce the regulations. The legislation outlines a structured framework for cryptocurrency mining, including definitions for mining pools and infrastructure operators, with the aim of standardising the industry.
One of the key features of the law is the prohibition of mining activities by entities involved in electricity transmission or management. This restriction is designed to prevent conflicts of interest and ensure that energy resources are not misused for cryptocurrency mining. The law also bans the public promotion and advertising of cryptocurrencies, reinforcing the prohibition on using digital currencies for financial transactions within Russia. However, it does permit the circulation of domestically mined cryptocurrency under specific conditions, while foreign digital assets can be traded on Russian blockchain platforms.
The legislation also grants the Russian government the authority to ban mining activities in certain regions, reflecting a nuanced approach to balancing industry growth with regional and resource management. This provision aims to address potential concerns related to local energy consumption and infrastructure impacts.
Prior to this law, cryptocurrency mining in Russia existed in a legal grey area with vague regulations and limited government oversight. The introduction of this legislation provides clarity and legal structure, addressing previous uncertainties surrounding the industry. The law is expected to bring stability and attract more regulated investments into the Russian cryptocurrency sector.
In a broader context, this regulatory move aligns with President Putin’s ongoing efforts to create a comprehensive legal framework for digital currencies. The legislation acknowledges the potential of cryptocurrencies to contribute to Russia’s economic development while ensuring that mining activities are conducted within a controlled and regulated environment.
Overall, the new law represents a significant shift in Russia’s approach to cryptocurrency, aiming to harness the benefits of digital currencies while addressing regulatory and operational challenges. The enforcement of these regulations will be closely monitored by the Russian government and the Bank of Russia to ensure compliance and effectiveness.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
