Chechen Republic Plans Eurasian Cryptocurrency Mining Pool
In a momentous move for the crypto economy of the European Union, Chechnya has announced its intention to create its own mining pool comprised of miners all over the Eurasian Economic Union. The mining pool will be based within the Chechen Republic, and is likely to draw the interest of investors from several countries within the expansive European Economic Union. One particularly appealing aspect of the new venture for citizens will be the relatively lax stance of Chechnyan authorities on cryptocurrencies, especially compared to regulators in their own home countries.
The goal of this project is to combine resources of mining citizens from Russia, Belarus, Armenia, Kazakhstan, and Kyrgyzstan in order to further develop the blockchain economy and general economy of the region in which the project is based. As a result of this interest, significant thought has been put into how exactly the region will structure its regulatory efforts in order to best facilitate a healthy growth of industry within the blockchain sector in Chechnya.
A Regulatory Sandbox
For those that have closely followed the regulatory scramble of governments in 2017 and 2018, the use of the regulatory sandbox should come as no surprise. A regulatory sandbox approach is employed when a government sets up a situation where blockchain entities are given relative free-reign over their business, but are closely monitored and studied by government officials and regulators.
The benefits to this regulatory approach are pretty clear. Regulators are able to easily collect data in order to steer the industry in the right direction, but a lack of hard stances means that companies on the blockchain are able to work towards innovation and change without having to cut through miles of troublesome red-tape placed by overzealous regulators. This type of approach is especially effective in the new era of fintech that is blockchain, where paradigms shift on a dime and change is always close.
The Chechen Republic has filed an application with the Bank of Russia to operate their new mining pool under a proposed regulatory sandbox framework employed by the country. This framework is generally understood, but experts involved in the project urge that the Russian territory must first officially adopt the regulatory laws regarding cryptocurrency before the Chechnyan mining pool can be officially established within its borders. It is predicted that this bill will likely be debated and considered by the autumn session of the State Duma.
Asset For Russia
One compelling point in favor of the Chechnyan proposition for a joint mining pool with members of the Eurasian Economic Union is that it will give Russia a bigger slice of the pie when it comes to the production of cryptocurrency on the world stage. A local news outlet outlined that private miners in Russia, if they were to combine their powers in an effective mining pool, would amount to a significant share of the global mining production of Bitcoin and other cryptocurrencies.
The country is currently working to establish a clear regulatory framework on the books for cryptocurrency.