Russian Lawmakers Forming a Working Group on Crypto to Address Growing Bitcoin Mining Industry
The chairman of Russia’s legislature, the State Duma, called for creating a new working group to focus on cryptocurrencies with a special focus on the rapidly growing local mining industry.
This week, Vyacheslav Volodin directed his deputy Aleksei Gordeyev to create an inter-committee working group on cryptocurrency. This committee will be headed by Andrey Lugavoy, First Deputy Chairman of the Committee on Security and Anti-Corruption, who had initially pushed the issue before the plenary session.
“We have prepared a bill, and we will introduce it without fail,” said Lugavoy on Thursday and stressed that the discussion of this issue is already ripe.
Lugovoi said that miners are enriching themselves, which he puts at $2 billion annually, at the expense of the population and do not pay taxes.
“Due to the lack of regulation of the turnover of cryptocurrency, law enforcement agencies generally fall into a dead end, since they cannot establish signs of a crime in the activities of individuals and make the necessary procedural decisions.”
As we reported, ever since China cracked down hard on crypto mining, miners moved overseas to the US, Kazakhstan, and Russia.
Recently, it also came to light that regulators were considering a proposal from Russian oil and gas giants to allow them to mine crypto using flare gas.
A couple of months back in October, Governor Igor Kobzev sent a letter to Russian Deputy Prime Minister Alexander Novak saying that a Siberian region, known for its cheap electricity, had its retail energy consumption spiking 159% this year, from 2020 levels due to an “avalanche” of underground crypto-mining.
In its letter, Novak said it led to significant loads on the power grid with the risk of accidents and emergencies and called for higher electricity rates for miners.
The same month President Vladimir Putin also said cryptocurrency can become a settlement unit and that it “has the right to exist and can be used as a means of payment.”
Much like Russia, the Kazakhstan government is planning to crack down on unregistered “grey” miners, who combined with “white” registered miners, account for about 8% of the country's total power generation capacity. It further plans to propose more taxes on miners.