The Russian government’s crypto working group chairman, lawmaker Andreу Lugovoy, believes that Bitcoin mining regulation should be a priority for Moscow. After years of infighting and neglect, Russian government bodies, ministries, and the Central Bank are finally close to regulating the crypto sector. The regulation of crypto mining is seen as the first step, with a focus on Bitcoin initially, followed by other cryptocurrencies and iterations. Lugovoy also mentioned the imposition of anti-money laundering and anti-terrorist financing rules on the cryptocurrency sector, with a possible prohibition of privacy coins like Monero due to their criminal use.
The lack of regulations in Russia has been particularly harmful to the fast-growing crypto mining sector, which has seen exponential growth in recent years. However, there are reports that the Ministry of Finance, the Central Bank, and the anti-money laundering agency Rosfinmonitoring have agreed on an approach to regulating cryptocurrencies. The working group, led by Lugovoy, has held multiple meetings with various stakeholders to discuss all aspects of the industry and ways to legalize it. The lawmaker emphasized the importance of consistency in regulatory actions and suggested that the results of these meetings would be seen soon.
Additionally, there have been concerns about the Ministry of Energy’s plans to raise electricity tariffs for miners, which could negatively impact legal miners and the benefits that Russia currently enjoys in the mining sector. Lugovoy suggested that industrial miners should be taxed like any other ordinary company and emphasized the need for transparency in reporting all imported mining hardware. There are also suggestions that miners should only use domestic crypto mining rigs, as proposed by Russian government crypto policymakers.
Lugovoy, who also serves as the First Deputy Chairman of the State Duma’s Committee on Security and Anti-Corruption, has been vocal on crypto-related matters. He has criticized the lack of regulation in the sector, stating that it plays into the hands of Western sanctions policies against Russia and undermines the country’s anti-sanctions efforts. Legalizing the crypto mining industry could potentially provide the Russian state with a significant tax revenue windfall of $540.3 million, according to miners. However, Rosfinmonitoring has called for faster implementation of crypto regulations following the Financial Action Task Force’s downgrade of Russia’s compliance rating in February.
In conclusion, the Russian government is taking steps towards regulating the cryptocurrency sector, with a focus on Bitcoin mining as the initial priority. The working group led by Andreу Lugovoy is working with various stakeholders to discuss all aspects of the industry and formulate a regulatory framework. There are concerns about the lack of regulation harming Russia’s economy and playing into the hands of Western sanctions. Legalizing the industry could provide significant tax revenue for the state. With calls for faster regulatory rollouts, the Russian government is under pressure to address the issues highlighted by international organizations like the FATF.
