The legal vacuum in the crypto mining sector must be filled “as soon as possible,” according to a statement by Russian Deputy Minister of Energy Evgeniy Grabchak. Officials from the government also suggested that crypto farm businesses be subject to regional quotas, instead of being regulated at the federal levels.
Russian Official Proposes Regional Energy Quotas For Crypto Miners
Cryptocurrency mining needs to be regulated soon, Evgeniy Grabchak insisted during Russia’s first national conference of legal bitcoin miners, held recently in Irkutsk. The Siberian oblast, where electricity rates start at just $0.01 per kWh, has been dubbed “the mining capital of Russia” as coin minting in the region spiked after China cracked down on the industry last May. Grabchak elaborates:
It is difficult to control this industry and create transparent rules. It needs to be eliminated as soon as possible… We have no other options in the current reality. Implementation of the legal regulation must include incorporation of the idea mining in to the regulatory framework.
Russia’s deputy minister of energy further suggested that it would be more expedient to determine sites for mining facilities and the available energy capacities at the regional instead of federal level. He stated that the quotas have to be compatible with other industries and Russian development plans.
Irkutsk, and other authorities in the region have stated that they are willing to host sites for industrial extractions of crypto currencies if such an activity is recognized by the government as entrepreneurial. Anatoly Ashakov (chairman of the Financial Market Committee), Deputy Prime Minister Alexander Novak and Igor Kobzev (Governor of Irkutsk Oblast) have all made calls in this direction.
Russia is looking at cryptocurrencies as an option to get back access to global financial markets, and Moscow may accept bitcoin to fund its energy exports. Despite the strong opposition of the Bank of Russia to legalizing a range of crypto activities, including mining, government efforts to regulate the country’s crypto space have resumed.
Most institutions have sided with the Finance Ministry’s approach which favors regulation under strict oversight, over a blanket ban. In February, the department submitted a new bill “On Digital Currency.” In January, President Vladimir Putin urged the government and the central bank to resolve their differences and highlighted Russia’s competitive advantages as a mining destination.
What do you think Russia’s crypto-mining sector will be regulated soon? Leave your comments below.
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