Russia has competitive advantages in mining – a surplus of electricity and well-trained personnel.
President Vladimir Putin said during a meeting with the government officials said:
“Of course, we also have certain competitive advantages, especially in crypto mining. I mean the surplus of electricity and the well-trained personnel available in the country,” he said.
The President asked the regulator and the government to come to a joint decision regarding the regulation of cryptocurrencies in Russia in the near future and report on the results for the discussion.
On Jan 20, the Central Bank of Russia gave three proposals; the first one aims to prohibit cryptocurrencies as payments, the second is related to mining, and the last is related to financial institutions’ investments in digital assets.
- “Establish liability for the violation of the statutory ban on using cryptocurrencies as a means of payment for goods, works and services sold and bought by Russian residents, whether legal entities or individuals. Prohibit the organization of the issue and/or the issue and the organization of the circulation of cryptocurrencies (including by cryptocurrency exchanges, cryptocurrency exchange offices, and P2P platforms) on the territory of the Russian Federation and establish liability for breaching this ban.
- Cryptocurrency mining should be banned as it creates unproductive consumption of electric power, which threatens the power supply of residential buildings, social infrastructure, and enterprises and implements Russia’s environmental agenda.
- Prohibit financial institutions’ investment in cryptocurrencies and related financial instruments like ETFs as well as the use of Russian financial intermediaries and Russian financial infrastructure to conduct cryptocurrency transactions, and stipulate liability for violating this ban.”
On January 25, the director of the financial policy department of the Ministry of Finance, Ivan Chebeskov, said that the ministry does not support the introduction of a ban on cryptocurrencies in Russia but advocates the regulation of this market.
The Russian state Putin noted that he is familiar with cryptocurrencies. He said that the Central Bank has its position on crypto: the regulator believes that activities associated with such highly volatile assets carry certain risks, primarily for citizens, but the regulator and the government departments should come to a joint decision regarding the regulation of cryptocurrencies in Russia in the near future.
In October last year, Putin said that “Cryptocurrencies Have A Right To Exist And Can Be Used For Settlements.”