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Russian President Vladimir Putin has endorsed into law the legalization of cryptocurrency mining in Russia, sparking dramatic gain for Bitcoin toward $60,000.
Russian news agency TASS captured this latest regulation in a fresh publication. The report highlighted that the new legislation introduces several crucial concepts, including virtual currency mining, mining pools, and mining infrastructure operators.
According to the report, Russia now recognizes mining activities as legitimate business activities rather than simply the issuance of digital currency.
Guidelines for Crypto Mining in Russia
The law also outlines specific guidelines for who can engage in cryptocurrency mining. Only Russian legal entities and individual entrepreneurs who are registered with the government can participate. However, individual miners are exempt from registration requirements if they keep their energy consumption within the limits set by the government.
Additionally, the report highlighted that foreign digital financial assets will be allowed to be traded on Russian crypto platforms. However, the Bank of Russia will have the authority to prohibit listing specific issues if it determines that they threaten Russia’s financial stability.
In a previous meeting with the government to discuss economic issues, Putin expressed his enthusiasm for virtual currencies’ potential. He stressed the significance of Russia taking swift action to establish a legal framework, develop infrastructure, and create an environment conducive to the circulation of crypto assets, recognizing it as a promising area for economic growth.
According to the report, the law will become effective ten days after its official publication date.
Bitcoin Reacts, Heads to $60K
Remarkably, the news of Russia permitting crypto mining has stirred the crypto market with dramatic gains. In particular, Bitcoin has surged toward the $60K region after rallying by 6% just a few hours ago. Other crypto assets have followed the trend. At press time, Bitcoin hovers around $59,600.
Russia’s Bill to Trade Crypto
Notably, this latest development comes just two weeks after Russian lawmakers passed a bill permitting businesses to utilize cryptocurrencies in international trade. Observers see this as an effort to circumvent Western sanctions imposed on Russia following its invasion of Ukraine.
The law will take effect in September. According to Elvira Nabiullina, the Governor of the Russian Central Bank, the first cryptocurrency transactions are expected to occur before the end of the year.
Russia has been grappling with significant delays in international payments with major trading partners such as China and the United Arab Emirates. This is largely because, under pressure from Western regulators, banks in these countries have become increasingly cautious in their dealings with Russia.