Russian parliament passes cryptocurrency trade and mining bill
Russia’s parliament has officially approved a bill that would allow the use of cryptocurrencies for international trade and legalize cryptocurrency mining activities. The bill is expected to enter into force on September 1, 2024, and is intended to address the difficulties faced by Russian banks due to regulatory restrictions and Western sanctions.
According to local reports in Russia, the vote on the bill was clear, with 404 votes in favor, representing 89.8% of the total vote. No MPs voted against or abstained. The main purpose of this new legislation is to stabilize and strengthen Russia’s economy through cryptocurrencies, especially at a time when trade activities with important trading partners such as China, India, the United Arab Emirates and Turkey are severely disrupted.
Regulation and promotion of cryptocurrency mining
A key feature of the bill is the authorization of Bitcoin mining activities. The legislation, drafted by Anatoly Aksakov, chairman of the State Duma Committee on Financial Markets, and other MPs stipulates that mining activities must be regulated by the government and the Russian Central Bank, with federal agencies responsible for ensuring Compliance. This initiative aims to legalize mining activities, ensure income is declared and taxes are paid, and illegal operations are avoided.
Additionally, the bill allows for the sale of mined cryptocurrencies without using Russian infrastructure and exempts these transactions from domestic currency regulatory laws. However, the use of cryptocurrencies for domestic payments remains banned in Russia.
The potential impact of the bill on the Russian economy
The passage of this bill symbolizes a major shift in Russia's digital assets and currency. With this move, Russia hopes to challenge existing global regulatory dynamics and strengthen its economic resilience. The bill also includes provisions banning cryptocurrency advertising, aiming to control the spread of digital currency use in the country.
Russia is considering legalizing stablecoins, which are typically pegged to stable assets such as the U.S. dollar or gold and have relatively low volatility, to simplify cross-border payments. Additionally, the Russian Ministry of Finance recently proposed allowing traditional exchanges to handle digital asset transactions for selected investors.
Global Cryptocurrency Trends and Challenges
This development reflects the growing acceptance of cryptocurrencies globally. Many countries, including the United States, China and Turkey, are integrating digital currencies into their financial systems. The Russian parliament passed this cryptocurrency bill, underscoring the global trend of cryptocurrency acceptance. However, the United States may try to counter this Russian move as it poses a challenge to the United States.
Nonetheless, the passage of this bill is of great significance to the Russian economy. Russia hopes to facilitate transactions between sanctioned countries by connecting to the digital currency systems of countries such as China, Iran and Belarus. This move would solidify the role of cryptocurrencies in international trade and could have far-reaching consequences for global economic stability.
Overall, Russia’s decision to approve cryptocurrencies for international trade represents a landmark decision. As cryptocurrencies continue to gain acceptance around the world, they will reshape economic policy and global trade dynamics.
