Crypto Mining Bill Introduced to Duma, Russia Enters New Era of Digital Finance

Crypto mines will be legalized in Russia. (photo: dock. Pixabay)

JAKARTA - A bill was introduced to the Duma, the lower house of Russia's parliament, on November 17 that would legalize the mining of cryptocurrencies and the sale of mined cryptocurrencies. Cryptocurrencies currently cannot be used for trading and payments in Russia.

According to a Russian media report, Interfax, the proposed crypto law reads, “Digital currency obtained as a result of mining can be obtained by persons mining this digital currency on the condition that Russia's information infrastructure is not used in conducting transactions with it, except in the case of transactions carried out by the established experimental legal regime.”

The chairman of the Duma's Financial Markets Committee Anatoly Aksakov told the local press that he expects the bill to pass all three deliberations in parliament in December to enter into force on February 1. Another source said the bill would become law on January 1.

“The enactment of the law will bring this activity into the legal field, and allow the establishment of law enforcement practices on issues related to the issuance and circulation of digital currencies,” said Aksakov.

The experimental sales regime was made possible by the law on digital innovation passed in 2020. The bill provides definitions of cryptocurrency mining and pool mining. The law also prohibits the advertising of cryptocurrencies in Russia.

A Russian platform for the sale of cryptocurrencies will be established if the law is passed, and Russian miners will be able to use foreign platforms. In the latter case, the controls and regulations of the Russian currency will not apply to the transaction but must be reported to the Russian tax service.

But currently, there is no law on the taxation of mining activities, although crypto mining is widespread in Russia.

A report released by the Central Bank of Russia, quoted by Cointelegraph, on November 7 shows that the country is preparing to introduce digital assets to its market.

The Moscow Exchange has drawn up a bill on behalf of the Central Bank to allow the trading of digital financial assets in September. The Izvestia newspaper reported on November 18 that major Russian brokers and exchanges are preparing for the entry of retail investors into the market.

Russia's policy on the use of crypto in cross-border payments was formulated in September. In addition to national laws, Russian crypto miners and other users also have to face international sanctions.