As Russian cryptocurrency advocates are working to attract global crypto mining operators, local lawmakers have gotten more serious about regulating the industry.
Anatoly Aksakov, chairman of the Russian State Duma Committee on Financial Markets, claimed that Russian lawmakers are now considering recognizing the crypto mining industry as a form of entrepreneurship under local business laws, TASS news agency reported Sept. 8.
“As this [crypto mining] is a type of entrepreneurial activity, it is obviously necessary to include it into the state register, to regulate it as a type of entrepreneurship under an appropriate code, and impose relevant taxation,” Aksakov said.
He said that the government is actively working on several legal initiatives related to the crypto industry, expecting to move forward with bills for crypto taxation, mining and digital currency issuance in the near future. Aksakov also stressed the need to provide more regulatory clarity for digital currencies, stating:
“We still need to discuss what digital currency actually is, although we call it currency, it is rather used as a financial instrument, or a financial asset that is a subject to investment, rather than a means of payment.”
According to Nikita Soshnikov, a former senior lawyer at Deloitte CIS and director of Alfacash, “Practical implications for the industry will be limited to the business registration and tax obligations, of course, with a certain degree of official recognition as a legitimate business.”
Russia officially adopted a basic legal framework for regulating cryptocurrencies like Bitcoin (BTC) in January 2021 as part of the law “On Digital Financial Assets,” prohibiting the use of crypto as a payment method. While officially legitimizing cryptocurrency investment, the law did not provide clear regulations for many specific industry aspects, including taxation, mining, rules for owning and reporting crypto holdings and others.
Related: Russia not ready to accept Bitcoin as legal tender, says Kremlin
The Russian State Duma approved a separate bill on crypto taxation in the first reading in February, requiring residents to report crypto transactions of a total amount exceeding $7,800 per year.
In August, the Council of Judges of the Russian Federation published an official statement related to the rights to own crypto by Russian judges. The authority specifically advised local judges to stay away from holding cryptocurrencies as they are viewed as a type of foreign financial instruments, citing local court regulations.