By Michael Scott
The Russian legislative body postponed voting on the proposed crypto mining bill to 2023. The lawmakers rescheduled the vote from the proposed December to allow detailed deliberations on its provisions. The proposed bill targets regulatory clarity on cryptos extraction and trading following the EU-led sanctions imposed to hinder Russia from accessing the global markets and financial system.
Detailed Review Forces Postponing of Vote on Crypto Bill
The decision to postpone the reviewing and voting of the draft regulations by State Duma members was conveyed by Anatoly Aksakov in response to RBC’s inquiry on crypto mining status. As chair of the financial market committee, Aksakov acknowledged that postponing the vote to 2023 will offer sufficient time to review the text of the crypto bill.
The long-serving lawmaker cited his experience and input to formulate comprehensive regulations for Russia to admit the need for additional approvals. His support for postponing the vote suggests the need for Russian regulators to reconcile their divergent views on specific provisions.
Amending the Digital Financial Assets Law
The bill’s submission to the Russian lower legislative house indicated that the bill targets to amend the On Digital Financial Assets law. The lawmakers acknowledged that though the law became effective in January 2021, it proved inadequate to the evolving crypto ecosystem. Consequently, the proposed bill targets to resolve the inadequacy owing to its partial coverage of crypto-related activities.
Russia portrays a comparative advantage in crypto mining due to its low-cost power. Besides, crypto miners consider the cool climate ideal to support the expanding industry. Aksakov suggested that spreading crypto mining activities generate additional earnings for amateur miners within the energy-rich regions.
The accelerated growth in crypto mining inspired various Russian institutions to reconsider a comprehensive regulatory framework. Such is considered urgent to ensure adequate coverage of various crypto activities.
Many Russian officials oppose the free circulation of cryptos, such as bitcoin, citing its volatility and vulnerability to fraud. Nonetheless, the utilization of cryptos in settling cross-border payments is gaining support. The lawmakers supporting legalizing its use laud its borderless capability as ideal to overcome the financial restrictions engineered by the EU to arm-twist Russia to end the war in Ukraine.
Journey of Russia’s Crypto Mining Bill
The promoters of the crypto mining bill have navigated several hurdles, particularly rejection rounds by the Duma legal department. The department leadership insisted on having coordinated input from the Bank of Russia.
In its part, Aksakov lauded the Bank of Russia for softening the hardline stance on virtual assets. He noted that the central bank supported the proposed draft, provided the minted cryptos were exclusively for foreign sale. Also, it required the crypto-exchange with fiat to comply with the unique legal regimes.
In his address to fellow parliamentarians, Aksakov affirmed the financial committee had approved the bill to expedite its adoption in the initial reading before the fall session ended. Aksakov emphasized during the mid-December address to propose the need for regulating the experimental legal regimes suggested by the Bank of Russia. Consequently, formulating and approving a separate bill is necessary to establish the experimental legal regimes that will oversee the proposed bill set for a vote in 2023.