New Russian Crypto Law Comes Into Effect November 1

Key Points:

• Russia has enacted a new law expanding government oversight on cryptocurrency mining, effective November 1.
• The Russian crypto law grants federal agencies broader access to digital currency identifiers to help track illicit activities.

According to Bitcoin.com, Russian crypto law, signed by President Vladimir Putin himself, has significantly expanded cryptography mining and its infrastructural setup in the country.

Read more: Russian Bitcoin Miners Get a Way Out to Avoid Sanctions 

Russia Crypto Law Paves the Way for Mining in the Country

The Russian crypto law will begin on November 1 and gives the government a way to exert more control over mining and solidify its oversight of digital currency operations. This is a major turn in Russia’s stance on cryptocurrency.

The legislation, which passed through the State Duma, Russia’s lower chamber, empowers the government to impose location-based restrictions on crypto mining. The authorities will have to specify places where mining is banned or restricted, using regional limits on electricity consumption and other considerations. Additionally, the law empowers the government to regulate infrastructure that enables mining processes, including the operation of mining pools in respective areas.

The new Russian crypto law will expand access to the digital currency address database for various federal services from one Federal Financial Monitoring Service to several executive and law enforcement agencies. In such a way, it would further enhance Russia‘s ability to fight illicit financial activities within the digital currency space.

Russia Turns to Crypto for International Trade Amid Sanctions

The Russian national mining register would move from under the Ministry of Digital Development to the Federal Tax Service. Henceforth, it would also be tasked with the registration of mining companies and procedures for removing companies from this register upon repeated failures to comply. Persons, however, can still not be obliged to register themselves, provided they use no more than a certain quantity of electricity.

This follows the increased sanctions by the United States, the United Kingdom, and the European Union that have been making cross-border settlements difficult for Russian companies. The parliament-approved legislative changes in July, among others, had legalized crypto mining to give Russian businesses the tools to circumvent these sanctions and keep trade routes open, particularly with friendly countries like China, Iran, and India.