Russian State Duma Passes Cryptocurrency Mining Regulation Bill

On July 30, the State Duma of the Russian Federation adopted a significant bill on cryptocurrency mining regulation. This bill, as reported by Forklog, which will come into force on September 1, 2024, aims to define and regulate various aspects of cryptocurrency mining in the country.

Key Provisions of the Bill

The bill introduces and defines the terms “mining,” “mining pool,” “mining infrastructure operator,” and “organization of digital currency circulation.” It establishes specific guidelines for different entities involved in mining activities:

• Russian Legal Entities and Entrepreneurs: Those included in the relevant register can directly engage in mining.
• Individuals: Allowed to mine cryptocurrencies without registration, provided they adhere to government-set energy consumption limits.
• Mining Infrastructure Operators: A separate register under the Ministry of Digital Development will oversee these operators.
• Regulatory Oversight: The government, along with the Central Bank of the Russian Federation, will determine specific requirements for miners. Roskomnadzor will monitor compliance.

Notably, the bill prohibits combining cryptocurrency mining with activities in the electric power industry. It also requires miners to report to the tax service, indicating where coins are deposited, and grants the government the authority to ban mining in certain regions.

Miners and mining pools must sell cryptocurrencies independently and without using Russian infrastructure. Additionally, the bill restricts advertising related to digital currencies and mining services to protect citizens from potential fraud.

Exclusions from the Bill

Several contentious provisions were removed before the second reading:

• Cryptocurrency Turnover: The provision banning the organization of cryptocurrency turnover was removed, allowing for the potential creation of Russian exchanges and exchangers.
• Individual Mining Ban: The proposal to ban mining for individuals was excluded, with deputies believing that current mechanisms are sufficient to control illegal mining activities.

Earlier on July 24, Unlock Blockchain reported that The State Duma, Russia’s lower house of parliament, has adopted a bill in its first reading to regulate cryptocurrency mining

The bill represents a significant step towards regulating the cryptocurrency mining industry in Russia, one of the world’s leading countries in terms of mined cryptocurrency volume.