Russia has just voted on regulations regarding cryptocurrencies and mining. Officially, the aim is to regulate this market. In practice, the goal may be different: using digital assets to bypass sanctions imposed on Moscow by the West.
Is Russia opening up to cryptocurrencies?
The Duma voted in favor of a bill regulating mining and the use of cryptocurrencies in international trade. 404 deputies present at the session voted in favor. No one voted “against” or abstained.
What the document contains. First, it officially allows bitcoin mining in Russia. It also establishes supervision over the industry. This is to be performed by the government and the central bank. In practice, this means equalizing the activity with any other, i.e. declaring income and paying taxes.
It is becoming legal to sell cryptocurrencies mined in Russia without using the country’s information infrastructure. Digital assets can (and this is key) be used in international trade. It is still forbidden to pay with them on the domestic market.
This is all part of a broader plan, I think. Russia also wants to regulate the stablecoin market. In the background, work is underway on the country’s CBDC, a digital ruble.
When you don’t know what’s going on…
When you don’t know what it’s all about, it’s all about money, goes the famous saying. And it’s probably similar in the case of Russian regulations.
For many years, the West has been imposing economic sanctions on Moscow. The reason? The Kremlin’s aggressive policy. This process intensified after the attack on Ukraine in 2022. Although the new series of sanctions – the one from 2022-2023 – did not destroy the Russian economy, it does make it harder for it to function. The point is that many international banks are de facto Western institutions. Not to mention SWIFT. As a result, Russian companies are blocked in this system.
The answer to the above may be the use of cryptocurrencies, stablecoins or future CBDCs in cross-border trade. And this is probably what is behind the new regulations (although the government will probably also happily embrace taxes from mining).
