Russian central bank junks proposal to legalize bitcoin mining

The Russian Ministry of Economic Development has stated its readiness to legalize Bitcoin (BTC) and crypto mining, and has the support of the Ministry of Energy — but, as is customary in Russian politics and all things crypto-related, the Central Bank wants to throw a wrench into the proposition.

According to Izvestia, a Ministry of Economic Development representative, the recognition of mining as entrepreneurship will allow the government to “tax income from such operations and thereby raise state budget revenues.”

The representative added that the ministry officials are discussing the initiative with the business community and entrepreneurs, who plan to offer the government with mining project proposals “in the near future.”

No love for crypto

Based on data compiled by the University of Cambridge in August of this year, Russia’s average monthly Bitcoin hashrate, or network computational power, accounts for 11.23% of the global total.

The plans, on the other hand, have already been dismissed by the Central Bank. A bank official said the Central Bank opposes any activities that foster the formation of monetary surrogates.

The bank, which supports the creation of a state-controlled digital currency, has pushed the Kremlin to follow China’s lead and effectively restrict cryptocurrency.

Advocating for crypto

However, business leaders, the aforementioned ministries, and financial heads have all advocated adoption — a fact that has resulted in a years-long stalemate.

“Cryptocurrency prices are extremely volatile, and losses can be catastrophic… the Central Bank never advises [people] on where to invest their money. However, in the case of crypto, tokens are not a good investment option, ” Elvira Nabiullina, the governor of the Central Bank, has issued a warning.

As things stand, Aleksey Minaev, the ministry’s deputy chairman of the Digital Economy department, has said that the crypto mining industry “deserves respect and regulation,” and that the government may help “miners legalize their profits” and “get tax advantages.”


Image courtesy of Cointelegraph News/YouTube

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