Russia’s Ministry of Finance Explores Cryptocurrency Export Strategy
Russia’s Ministry of Finance is exploring the idea of exporting cryptocurrency generated through mining operations within the country. The Ministry is inspired by the successful model used for natural gas exports. Ivan Chebeskov, Deputy Minister of Finance, mentioned during a recent event on “Cryptocurrency and the Future of Digital Finance,” that draft legislation is being developed based on existing regulations for natural gas exports. Chebeskov also stated that Russian miners may be granted licenses to sell Bitcoin as an export product. The idea is to create special legislation that allows miners to export the cryptocurrencies they mine. This move comes in light of the abundant resources and affordable electricity in Russia, which have attracted numerous miners to establish their operations in the country. Furthermore, Chebeskov highlighted the consensus between the Bank of Russia and the Ministry of Finance regarding the recognition of cryptocurrency mining as a profession.
The Path to Legalization of Crypto Mining in Russia
A bill proposing the legalization of crypto mining was submitted to the State Duma in November 2022. The bill outlines the process for miners to sell their cryptocurrency, while also prohibiting the advertising or offering of digital currency to an unlimited number of people. The Central Bank of Russia has specified that the mining proceeds can only be sold using foreign information infrastructure and to non-residents. Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market, has suggested that comprehensive legislation regulating crypto mining may be implemented in 2024, possibly during the summer of 2023. Since facing sanctions in response to the invasion of Ukraine, Russia has been uncertain about its crypto policy. The country is yet to make a final decision regarding the legalization of cryptocurrencies.
Growing Crypto Market in Russia Amidst Sanctions and Limited Exchanges
Despite facing Western sanctions and a lack of global crypto exchanges, the crypto market in Russia is thriving. Binance, one of the largest crypto exchanges, has announced it will stop accepting deposits in Russian rubles, with RUB withdrawals set to be discontinued after January 31, 2024. To facilitate the transition, Binance has advised its Russian users to withdraw their funds and transfer them to CommEX, a newly established crypto exchange that acquired Binance’s Russian division in September 2023. Users also have the option to use Binance’s fiat partners to exchange RUB for cryptocurrencies via the Binance Spot Market or utilize the “Convert” feature to convert RUB to cryptocurrency. The transfer of Binance’s operations to CommEX raised concerns due to the lack of disclosure surrounding the deal’s details and the identities of CommEX’s founders. However, it signifies the ongoing developments in the Russian crypto market and its resilience in the face of challenges.