The State Duma, Russia’s lower house, noticed that cryptocurrencies are gaining popularity as a result of their increasing market value. Andrey Lugovoy, one of its members, stated that ‘unsecured’ bitcoin now trades at $68,000 per coin. He also added:
Three years ago, a person would have invested 1,000,000 rubles to get 5 billion.
The deputy said that the LDPR Liberal Democratic Party of Russia will file a draft law regarding regulation of cryptocurrency mining. The vast, energy-rich country has seen digital coin minting expand in spite of the lack of comprehensive government regulations.
Many companies and ordinary Russians have been drawn to the mining industry by its profitability. Lugovoy believes that it is time to regulate crypto mining by adopting new legislation. The Regnum news agency quoted the lawmaker as saying:
We can’t rush to make things right. It should be strictly prohibited, and the law enforcement system adjusted accordingly. I’m not sure how that could be done given that this is a virtual reality. Or let’s allow it.
According to the nationalist, the solution will protect Russian citizens, simplify taxes, increase budget receipts, and provide transparency. The parliamentarian explained that entrepreneurs will have the opportunity to do business legally.
Andrey Lugovoy noted that regulatory norms are especially important for regions with high energy resources, such as Irkutsk Oblast which has low electricity rates. Many cryptocurrency miners are attracted to the cheap energy in these regions and other parts of the country, the lawmaker stated.
The law “On Digital Financial Assets”, which was enacted in January, has only partially covered cryptocurrencies in Russia. It introduces rules to regulate related activities, such as “digital currency issuing”, but it doesn’t explicitly mention cryptocurrency mining.
It has been popular to recognize mining as an entrepreneurial activity. Officials in Moscow believe that this would allow them to tax the profits of miners. This approach was supported by Anatoly Aksakov (chair of the Financial Market Committee at Duma), who disclosed that mining will likely be affected by several upcoming legal amendments during fall session.