Russia is coming up with crypto news again. Since the sanctions imposed by various countries, the country is trying to find other ways to save itself. Bitcoin is one of the options to make Russia independent.
The country is trying to make this as attractive as possible, and one of these actions is to make bitcoin VAT-free. This is not to be nice to Russian citizens, but it is part of a larger plan. Russia sees bitcoin as a way to break its economic isolation. And that includes mining.
Only selling to foreign countries
For this reason, the country also wants to legalise the mining of crypto. This would allow miners to mine in the country freely, but there is a catch. A financial official of Russia has one requirement for these miners: the mined crypto must be sold to a foreign country. But why?
Kirill Pronin of the Russian Central Bank (CBR) has acknowledged this legalization of crypto mining under these conditions. It is remarkable that the CBR is thinking about this at all, because this bank is normally not a crypto fan.
On the other hand, payment traffic with foreign countries is limited because of the war, so Russia has to look for solutions. That could be bitcoin, but you don’t want bitcoin to turn domestic payments upside down, as Pronin saw it.
Do not motivate domestic crypto payments
The requirement for miners is therefore as follows: the mined crypto must be sold abroad. Indeed, it must not become a replacement for the rouble.
“Despite the fact that we consistently speak out in favour of the ban on the turnover of cryptocurrencies […] the discussion about the legalisation of mining is possible,” Pronin said.
“Ultimately, we have to say that there should be an export of these mining services, and the mining activities should not lead to accumulation of cryptocurrency in the country so that there will be no motivation for further use in internal payments.”
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Florian Feidenfelder is a seasoned cryptocurrency trader and technical analyst with over 10 years of hands-on experience analyzing and investing in digital asset markets. After obtaining his bachelor's degree in Finance from the London School of Economics, he worked for major investment banks like JP Morgan, helping build trading systems and risk models for blockchain assets.
Florian later founded Crypto Insights, a leading research firm providing actionable intelligence on crypto investments to hedge funds and family offices worldwide. He is the author of the bestseller "Mastering Bitcoin Trading" and has been featured in prominent publications like the Wall Street Journal, Bloomberg, and Barron's for his insights on blockchain technologies.
With extensive knowledge spanning the early days of Bitcoin to today's explosive DeFi landscape, Florian lends his real-world expertise to guide both new entrants and seasoned professionals in capitalizing on the wealth-creating potential of crypto trading while effectively managing its inherent volatility risks.