Russian President Vladimir Putin recently signed a new set of laws establishing regulatory frameworks for cryptocurrency mining. While these laws set definitions and guidelines for the industry, they stop short of fully “legalizing” crypto mining, instead focusing on control measures and restrictions.
Regulatory Highlights
The first law, enacted in August, defines core terms such as “mining” and “mining pools” and requires registration and reporting for mining businesses. It prohibits foreign entities from mining in Russia and allows the government to restrict mining in regions with energy constraints.
The second law, signed on October 25, adds specific rules on digital currency circulation, becoming effective on November 1, 2024, with full implementation slated for March 2025.
Increased Regulatory Clarity Without Full Legalization
Industry experts highlight that while these laws fill a regulatory gap, they don’t constitute full legalization. Nikita Zuborev, chief analyst at BestChange, explained that the legislation provides operational standards but leaves out specific tax and energy restrictions, to be set by future ministry regulations. Attorney Maria Agranovskaya remarked that although large mining companies previously operated without legal issues, the new laws offer clarity without fully legalizing the industry.
Addressing the “Gray Area”
Before these laws, crypto mining operated in a “gray area” without explicit regulations, allowing some operational freedom but creating uncertainties around electricity rates and legal classification.
Lawyer Anna Maximenko pointed out that the new framework eliminates some ambiguities, making the activity legally distinct but imposing restrictions, including a ban on foreign mining participation.
Restrictions and Regional Bans
The laws also prohibit individuals in the power industry from engaging in crypto mining and allow the government to restrict mining in energy-constrained regions. The regions likely to be affected include the Far East, Southwest Siberia, and Southern Russia.
Unclear Path for Selling Mined Coins
The new laws do not address the legal sale of mined digital assets, a gap expected to be filled by future regulatory updates. Until then, crypto transactions in Russia remain in a gray area, with exchanges not yet officially registered.
Future Developments
The new laws mark another step following Russia’s 2021 law “On Digital Financial Assets,” which provided a legal status for cryptocurrencies like Bitcoin but prohibited their use as payment. The evolving legal environment shows that while crypto mining is increasingly regulated, further updates are expected to address sale and transaction legality fully.
