In a significant legislative development, Russia’s State Duma, the lower chamber of the Federal Assembly, has enacted two pivotal laws pertaining to cryptocurrency. These new regulations, reported by policy experts to CoinDesk and Ria Novosti, Russia’s state-owned news agency, mark a notable shift in the country’s approach to digital currencies.

Legalization of Cryptocurrency Mining

The first law, effective from November 1, 2024, fully legitimizes cryptocurrency mining within Russia. Entities and individual entrepreneurs registered with the Ministry of Digital Development are authorized to engage in mining activities. Conversely, those unregistered may operate mining rigs provided their energy consumption remains within specified limits, as reported by Ria Novosti.

Regulatory oversight of mining operations will be distributed among various institutions, with the Bank of Russia wielding significant control. The cabinet of ministers will independently determine the requirements for mining infrastructure operators. Additional stipulations, including those for mining pool participants, will be established by the Russian government in consultation with the Bank of Russia.

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Miners will be mandated to report the digital currencies obtained through their operations to a government-authorized body. Moreover, this body, alongside the central bank, will possess the authority to impose bans or restrictions on digital currency transactions to uphold Russia’s monetary stability. This legislation also enforces a prohibition on advertising cryptocurrencies and offering them to an unrestricted audience.

Experimental Regime for Cross-Border Settlements

The second law, effective from September 1, 2024, introduces a special experimental regime granting the Bank of Russia the power to authorize companies to conduct cross-border settlements and exchange trading in digital currencies. According to Anti Danilevski, founder and CEO of Kick Ecosystem, companies, exchanges, and crypto entities will need to apply to the central bank to participate in this experimental framework.

This regime allows the Bank of Russia to conduct up to three experiments starting September 1 of this year. These experiments include utilizing cryptocurrency for foreign trade settlements, facilitating exchange trading in digital currency, and creating an electronic platform for cryptocurrency operations based on the National Payment System (NPS), as detailed in a separate Ria Novosti report.