Russian lawmakers are considering legalizing the industrial crypto mining sector while imposing strict limits on private miners. The State Duma is set to debate a new mining law in the current session, which could be bundled with proposed crypto regulation that would ban crypto exchanges in Russia. Some exceptions would be made for companies operating under the Central Bank’s supervision in a sandbox. Industrial miners and international trade firms using crypto in place of USD may have access to Moscow-controlled exchanges. The bill proposes that only Russian firms with permission will be allowed to continue mining, with a permit system in place for individuals exceeding energy consumption limits. The bill may come into force on September 1, with industrial miners required to report their activities to the anti-money laundering agency.
The proposed bill could allow industrial miners to sell coins without utilizing Russian information infrastructure, possibly referring to overseas crypto exchanges. The Central Bank aims to keep crypto out of the domestic economy by requiring domestic firms to sell their coins on foreign trading platforms. The bill also gives power to energy providers and local government bodies, allowing the government to ban mining activities in certain regions. However, there is still much debate about the terms and scope of potential bans. Chinese companies are turning to small banks on the border and underground financing channels for Russia-related transactions as Chinese big banks pull back from financing.
Law experts in Russia have mixed opinions about the new bill, with some expressing doubts about its effectiveness. Yuri Brisov, a partner at Digital and Analogue Partners, noted that previous attempts to regulate mining have failed. The latest effort seems to be driven by lobbying from the industrial mining sector, but the bill would likely need revisions before being accepted for a vote. Brisov highlighted flaws in the current draft law, stating that it is crude and poorly written, with little chance of being accepted in its current form. The bill’s timing for a September rollout may face challenges as lawmakers continue to refine the legislation.
The bill aims to regulate the crypto mining sector in Russia by implementing measures such as energy consumption limits and permitting systems for individuals and businesses. Industrial miners would be required to report their activities to the anti-money laundering agency, while some exceptions may be made for international trade firms using crypto for transactions. Chinese companies are exploring alternative financing options for Russia-related transactions as major Chinese banks retreat from financing. The bill could give power to energy providers and local government bodies to oversee and possibly ban mining activities in certain regions. Overall, the proposed legislation reflects the ongoing efforts by Russian lawmakers to navigate the complexities of the crypto industry while balancing the interests of different stakeholders.
