Russia Legalizes Cryptocurrency Mining, Sparking A Surge In Bitcoin
On Thursday, Russian President Vladimir Putin signed a law that legalized cryptocurrency mining in the country.
The legal document has been published on the government's website and will come into effect 10 days after publication.
The document states that only registered Russian legal entities and individual entrepreneurs have the right to mine, in addition, individuals who do not exceed the energy consumption limits set by the government will also be granted the right to mine digital currencies without the need for registration.
According to the document, foreign digital financial assets are allowed to be traded on Russian blockchain platforms, but if the Central Bank of Russia finds that they pose a threat to Russia's financial stability, it will have the right to ban the issuance of certain crypto assets.
The newly legalized cryptocurrency mining supervision will be jointly responsible by the Central Bank of Russia, the Ministry of Finance, and specific departments of the Russian government, which will formulate more precise regulatory requirements in the coming months.
Russian authorities are also expected to take some measures to exclude the possibility of using digital currencies for money laundering. In addition, the bill will also prohibit large-scale cryptocurrency advertising within Russia.
The news has led to a significant increase in Bitcoin. On Thursday, the price of Bitcoin rebounded from its low, with a nearly 7% increase and returned to $60,000.
Last month, Putin discussed the introduction and use of digital currencies with the government at a meeting on economic issues.
Putin pointed out that this is a promising economic field, and it is important for Russia to seize the opportunity to quickly establish a legal framework and supervision, develop infrastructure, and create conditions for the circulation of digital assets.
At the end of last month, the Governor of the Central Bank of Russia, Elvira Nabiullina, also said that the Russian Parliament would consider a law allowing international payments through cryptocurrencies.
Analysts point out that Russia's legalization of cryptocurrency mining is an important sign of the BRICS countries' development in the field of digital currencies.
The BRICS countries are increasingly seeking to reduce their dependence on the US dollar for international trade. The group first proposed the idea of alternative digital currencies at the 11th BRICS Leaders Annual Meeting held in 2019, which attracted widespread attention but also faced significant obstacles.
In 2023, Russia refocused on developing a unified BRICS currency, and it was reported that the Deputy Chairman of the State Duma, Alexander Babakov, claimed that the main members of the emerging economic group are working hard to develop a new currency for international trade settlement. Shortly after this statement, the Central Bank of Russia and the Russian government announced plans to establish special entities to use digital assets as a method of cross-border settlement.