All eyes are now on Russia since the country's government announced its intention to regulate cryptocurrencies and recognise bitcoin as a currency. While waiting for the impact of such a law on the markets, the Russian Ministry of Economic Development would like to legalise bitcoin mining in specific regions of the country. Its proposal aims to recognise mining as a commercial activity and to introduce taxes on the resulting profits.

Russia: Economic Development Ministry wants to legalise bitcoin (BTC) mining

Taking advantage of areas with a sustainable surplus of electricity production

Last month, President Vladimir Putin had already expressed his support for bitcoin mining, saying that Russia has what it takes to make a mark in the sector. The Russian Ministry of Economic Development has now introduced a bill that would make it easier to mine bitcoin in areas with a sustainable surplus of electricity production. It suggests that mining companies should receive a reduction in fees for setting up their data centres in such areas.

The ministry also wants to introduce an energy usage limit for individual miners, and introduce higher tariffs for increased energy expenditure. These reforms should remove the risk of electricity shortages for domestic power. However, the consumption thresholds that will be imposed on bitcoin miners have not yet been defined. Finally, the Russian authorities obviously intend to introduce taxes on mining in return. 

Imminent regulation of cryptocurrencies in Russia

Despite the reluctance of the Ministry of Finance, the Russian government and the country's Central Bank are expected to present a joint bill on the regulation of cryptocurrencies by Friday. This initiative has already gained the support of several local financial institutions. The latter prefer to regulate crypto-currencies rather than ban them in order to ensure the protection of individuals who wish to invest in these assets.

Deputy chairman of the executive board of Russian banking giant Sber, Anatoly Popov recently made this point. "Our position coincides with that of the government, which believes that cryptocurrencies should be regulated, not banned. There is a need for effective regulation that will allow citizens and organisations to legally acquire cryptocurrencies, take into account anti-money laundering mechanisms and taxation," he said.

Like the US, Russia intends to take advantage of China's mining ban by extending its arms to miners looking for new land to settle in. The country has therefore identified areas with a sustainable surplus of electricity production to facilitate their establishment.

Source: Cointelegraph

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