Friday, Aug 19, 2022
Outlook Money

Russia Amends Digital Currency Bill, To Include Crypto Mining, Trading: Report

Russia’s finance ministry has amended its digital currency bill to include cryptocurrency mining provisions

Russia's Ministry of Finance has modified its digital currency bill to incorporate provisions for cryptocurrency mining.

The Ministry of Finance of Russia has amended its digital currency bill to include cryptocurrency mining provisions, the agency Kommersant announced on April 15. The ministry had earlier in February this year presented to the Federal Assembly the original draft cryptocurrency law, which concentrated on digital assets as investment vehicles. The ministry has now stated that the updated version of the bill contains detailed rules around trading and mining of cryptocurrencies.

Amid the Russia-Ukraine War, both countries had started using cryptocurrency to run their financial system. This legislation named “On Digital Currency,” has seen interest from the Russian government.

According to several media reports, the main focus of the legislation was applying regulations in the digital asset mining industry, since Russian President Vlamadir Putin finds the niche useful. Moreover, Russia is also one of the leading countries in the world in crypto mining in terms of global hash rate, just behind the US and Kazakhstan.

In this recent bill, the finance ministry has said that miners will have to submit their application in a suitable register, as the government will provide the necessary data centres for that. Also, taxation will be set separately, according to reports. 

“Finally, for the first time, the draft law considers in detail the mining process that legal entities and individual entrepreneurs will be able to carry out after being included in the relevant register,”, a crypto news platform quoted the legislation. 

However, the Prime Minister of Russia, Mikhail Mishustin, and president of the Chamber of Commerce and Industry of Russia, Sergey Katyrin, have given collections of proposals to boost economic relations with African nations, among which it was also suggested to provide alternative payment options, such as crypto. 

“It seems appropriate to instruct the Ministry of Finance, together with the central bank, to ensure the conclusion of intergovernmental agreements with African states on the use of national currencies and cryptocurrencies in mutual settlements and payments,” quoted Katyrin as saying. 

Earlier In January 2022, the Bank of Russia, the country’s central bank had called for a ban on cryptocurrency mining, citing concerns that digital assets could damage the country’s financial stability. Later in March 2022, Bank of Russia had granted a licence to Sberbank, Russia’s top lender, to begin giving digital assets in response to US economic sanctions, according to various media reports. 

“Assets issued on the bank’s digital platform will be recorded and circulated via a distributed ledger technology system, ensuring “data security” and data immutability,” Sberbank was quoted as saying in an official statement by various reports.