Putin in Russia Finally Signed on Bitcoin and Cryptocurrencies!

The Russian government, signed by President Vladimir Putin and crypto para introduced a new law aimed at expanding state control over the industry.

The law, which will come into force on November 1, puts tighter control on cryptocurrency mining activities and gives the government more authority to regulate the industry.

The law gives the Russian government the authority to impose local restrictions on cryptocurrency mining based on regional needs. This authority includes the authority to define specific procedures for enforcing restrictions and suspend mining pool activities in certain areas. The legislation also reveals the government’s intention to tighten its grip on the sector by providing greater regulatory control over infrastructure providers that support mining activities.

In addition, the law expands the responsibilities of federal agencies, providing access to digital currency identifier addresses to various executive and law enforcement agencies, including the Federal Financial Monitoring Service (Rosfinmonitoring). This expansion aims to support efforts to monitor cryptocurrency transactions that may be linked to money laundering or terrorist financing activities.

An important change in the new law is the transfer of responsibility for managing the national mining registry from the Ministry of Digital Development to the Federal Tax Service. The tax office will now audit the record, monitor compliance and impose penalties for repeat offenders. While individual miners can continue without registering as long as they stay within electricity consumption limits, companies and individual entrepreneurs must comply with the new registration requirements.

Russia’s latest move to tighten cryptocurrency regulations comes as the country looks to advance its strategy in the digital currency space. The government is developing the digital ruble and aims to legalize crypto mining, allowing the use of cryptocurrencies in international trade. This approach is seen as a way to bypass Western sanctions and reduce dependence on the US dollar for foreign exchange transactions.

In August, President Putin signed legislation enabling experimental frameworks for the use of cryptocurrencies in international transactions. The law allows regulatory approval of cross-border crypto transfers, with the Bank of Russia overseeing pilot projects. Approval also needs to come from the Ministry of Finance, the Federal Security Service and Rosfinmonitoring.

*This is not investment advice.