Evgeniy Grabchak, the Deputy Minister of Energy in Russia, stated that they need to fill the legal vacuum in the country’s crypto mining industry as quickly as possible. According to the government official, rather than regulating crypto mining businesses at a federal level, it is better to introduce regional quotas for the mining farms. Legal bitcoin miners in Russia had their first national conference recently in the city of Irkutsk. While attending the conference, the Deputy Energy Minister shared his thoughts. After China launched a crackdown on crypto mining in the country last May, the miners were forced to shift their operations to other countries.
The Siberian oblast Irkutsk saw coin minting spike after that and is now referred to as Russia’s mining capital. This is primarily because of its low electricity rates, which start as low as $0.01 per kWh. Grabchak said that regulating this field has become difficult because of the legal vacuum, which means there cannot be any transparent rules applicable to the game. He added that eliminating this vacuum as soon as possible was a must because there are currently no other options. He said that they needed to come up with a framework for crypto mining and legalize it as soon as possible.
As per the deputy minister of energy, it would save time if they can determine the sites that are ideal for mining facilities and the energy capacities available at a regional level, instead of a federal one. He stated that these regional quotas should be compliant with the development plan of other industries, Russian regions as well as the energy system. Authorities in Irkutsk, along with other regions in Russia, have already expressed their willingness to provide sites for setting up crypto mining farms. They are ready to do so, as long as the mining business is considered an entrepreneurial activity, which is something that many government officials have suggested.
Igor Kobzev, Irkutsk Oblast’s Governor, Alexander Novak, the Deputy Prime Minister and Anatoly Aksakov, the chairman of the Financial Market Committee of the parliament have all made similar calls. Due to increasing sanctions on Russia because of the invasion of Ukraine, the country has seen cryptocurrencies as an opportunity in order to get access to the global financial market. As a matter of fact, Moscow is even deliberating the possibility of accepting bitcoin payments for its energy exports. Even though the Bank of Russia is strongly opposed to the legalization of crypto in the country, including trading and mining, the government appears to have renewed its efforts to regulate the crypto space.
Majority of the institutions are in agreement with the Finance Ministry, which has stated that regulation is a better option with strict oversight, rather than imposing an outright ban. Back in February, a new bill was submitted by the department named ‘On Digital Currency’. President Vladimir Putin had told the central bank and the government back in January to find a way to settle their differences and also highlighted the competitive advantages Russia has when it comes to being a crypto mining destination.