Putin Signs New Crypto Mining Law

Vladimir Putin has enacted a new law that shifts oversight of Russia's crypto mining registry to the Federal Tax Service (FTS).

The FTS will now manage the registry specifically for industrial crypto miners, while home-based miners can remain exempt from registration as long as they adhere to specified energy usage limits.

This legislation amends a previously expedited bill from the State Duma, which initially assigned control of the registry to the Ministry of Digital Development.

However, the FTS has determined that to effectively tax crypto miners, it requires comprehensive control over the registry. This move marks a significant step in Russia's regulatory approach to cryptocurrency mining.

New Crypto Mining Law Lets Nation Tax Miners

The newly enacted law empowers Russia's tax authorities to monitor all aspects of industrial crypto mining, including currency movements and sale orders.

According to reports, this legislation grants tax officials comprehensive access to information regarding crypto asset transactions, such as identifier addresses and transaction histories.

Additionally, government agencies, including Rosfinmonitoring—Russia's anti-money laundering body—and the Federal Security Service (FSB), will have the authority to access transaction data.

Several other government-aligned organisations can also conduct searches and request information as needed.

The industry has largely welcomed this law, viewing it as a significant step toward legitimising a sector that is just beginning to emerge from obscurity.

New Law Talks About Temporary Bans

The most notable provision of the bill addresses the issue of temporary bans on cryptocurrency mining.

This legislation empowers individual regions to impose local restrictions, a move prompted by ongoing energy challenges in areas like Buryatia, which borders Mongolia.

This region has faced power shortages attributed to miners operating in nearby Irkutsk, known as Russia's unofficial Bitcoin mining hub.

In recent months, authorities in Irkutsk have intensified efforts to curb illegal mining activities, which they believe are disrupting the power grid across Southern Siberia.

Interestingly, some miners may view this new law favorably, as it could alleviate concerns stemming from previous proposals by the Ministry of Energy.

The ministry had suggested mandating shutdowns for all legal miners for several weeks each year to mitigate potential power issues.

Moving Mining to the Legal Field

Oleg Ogienko, chief of BitRiver Communications, expressed to Izvestia that integrating cryptocurrency mining into the legal framework would significantly benefit the IT sector and stimulate job creation.

He and other industry leaders argue that effective legislative measures are crucial for Moscow to tackle "gray" (illegal) mining operations, which contribute to energy shortages in certain regions.

Following President Putin's endorsement of Russia's first cryptocurrency mining legalisation law on 9 August, BitRiver has swiftly announced plans to collaborate with a government agency to establish crypto mining and AI facilities in BRICS nations.

Additionally, various Russian regions are accelerating efforts to develop crypto mining centers in areas traditionally not known for such activities.