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Bank of Russia Ready to Legalize Crypto Mining If Miners Sell Minted Coins Abroad

Bank of Russia Ready to Legalize Crypto Mining

Moscow’s monetary authority is ready to support the legalization and sale of crypto-mining coins. According to Kirill Pronin (head of Bank of Russia’s Financial Technologies Department), this is according to a recent statement.

In the ongoing Russian discussions about cryptocurrencies, the central bank has been a strong voice. It proposed a blanket ban on all related activities, including mining, earlier in the year. It has begun to change its position after facing opposition from other institutions and having to face financial restrictions imposed by the war in Ukraine.

Elvira Nabiullina, Governor of Russia, stated last month that crypto payments are allowed provided they do not “penetrate” the Russian financial systems. She also stated that digital currencies such as bitcoin shouldn’t be traded on Russian exchanges because they are too risky and volatile for potential investors.

Pronin stated that mining is not under the jurisdiction of the Central Bank of Russia (CBR), but it is one of many ways to obtain cryptocurrency. He spoke at the St. Petersburg International Legal Forum. Pronin also noted that fees are charged for crypto transaction validation. Interfax quoted him as saying that while legalization of mining could be discussed, there are a few conditions that must be met.

Director of the Financial Policy Department at the Finance Ministry, Ivan Chebeskov pointed out that large crypto mining firms based in Russia have had to comply with foreign restrictions when withdrawing money. Russia might need to build its own exchange infrastructure in order to supply liquidity to the sector, he suggested.

Kirill Pronin said that cryptocurrency created in Russia by miners should be exported and not stored within the country. It is important to not create incentives for the use of cryptocurrency in domestic payments.

The State Duma submitted a separate draft law on mining in the Russian Federation in April, in addition to the “On Digital Currency” bill. This bill is expected to regulate Russia’s crypto market in a comprehensive manner. The lower house of the Russian parliament has proposed to recognize crypto mining in Russia as a business activity that uses Russian information infrastructure and equipment.