- The deputy minister for energy has called on the government to resolve the legal ambiguity around crypto mining and make it legal as soon as possible.
- The call comes at a time when Russia is looking to crypto for salvation after severe sanctions imposed by most economic powers for its war in Ukraine.
The world’s third-largest cryptocurrency mining nation has been urged to make the activity legally recognized as soon as possible. Russia’s Energy Ministry believes that the legal uncertainty is not doing any good to the sector and that the country would greatly benefit from legalizing the industry.
Russia ranks third globally as a Bitcoin mining hub, only behind the U.S and Kazakhstan respectively, accounting for about 11 percent of the global BTC hash rate according to the latest data. However, this rise has come without any formal regulations, and in the past six months, there have even been calls to ban the industry in its entirety, just like China has done.
Deputy Minister of Energy Evgeny Grabchak believes legalizing and regulating the sector would be in Russia’s best interest. Speaking to local news agency TASS, he noted that the legal vacuum that exists in Russia regarding crypto mining is detrimental, especially since Russians will keep mining regardless of the legal uncertainty.
The legal vacuum makes it difficult to regulate this area and set clear rules of the game. This legal vacuum needs to be [eliminated]as soon as possible. If we want somehow to get along with this activity, and we have no other options in the current reality, we must introduce legal regulation, adding the concept of mining to the regulatory framework.
Further, the official believes that the regulating of the sector should be done at a regional level, not a federal level. This would leave local authorities with the responsibility of determining and licensing mining sites and the distribution of energy to these miners.
It’s not the first time that a Russian Ministry has advocated for the regulation of crypto mining. In February, the Ministry of Economic Development proposed that mining be allowed in specific areas with a sustainable surplus in energy production. It also recommended lowering the costs of putting up mining centers and reducing the cost of electricity consumed in these centers.
For the Energy Ministry, the latest move signals a gradual change in attitude towards crypto mining. In October last year, Minister Nikolay Shulginov suggested that crypto miners should pay more for their electricity.
“These miners are, in fact, using electricity for households, on the price that is subsidized by the regional government, for business purposes,” he said.
Russia is now turning to crypto to evade sanctions that are slowly crashing its economy. The U.S, the European Union, the U.K, Canada, and other major powers have turned against President Vladimir Putin’s government after its invasion of Ukraine.
Read More: Russia open to accepting Bitcoin payments for oil and gas amid strong western sanctions
Credit: Source link
