Russia's Ministry of Finance Backs Official Recognition of Cryptocurrency Mining

Russia's Ministry of Finance supports the initiative to officially recognise cryptocurrency mining, aiming to assign it a code in the All-Russian Classifier of Types of Economic Activities (OKVED). Osman Kabaloev, Deputy Director of the Department of Financial Policy, shared this development with Izvestia.

Cryptocurrency Mining Classification: Legal Regulation and Economic Codes

Before assigning a specific OKVED code, a law regulating cryptocurrency mining must be enacted. This law will define the parameters for the classifier. Kabaloev mentioned that mining could either be classified under an existing economic activity code or have a new, dedicated code. The Ministry of Economic Development is currently addressing this issue.

Establishing Legal Framework for Cryptocurrency Mining: Definitions, Regulations, and Investor Protections

Presently, Russian legislation does not recognise the concept of "mining." It is essential to introduce legal definitions and regulations for issuing, accounting, and circulating cryptocurrencies. This includes defining the status, rights, and obligations of companies involved in mining. The Ministry of Industry and Trade emphasised the necessity of establishing guarantees for investor rights protection. Mining could be classified as an industrial activity under the OKVED framework.

Controversy Surrounding Mining Regulation: A Clash of Government Oversight and Crypto Community Opposition

In the fall of 2022, a bill regulating mining was introduced to the State Duma. The proposed legislation suggested that the Russian government, in collaboration with the Bank of Russia, should set requirements for individuals and legal entities involved in mining, including mining pools. However, the crypto community reacted negatively to this bill. The Russian Association of Cryptoeconomics, Artificial Intelligence, and Blockchain argued that the established industry did not need excessive regulation and the involvement of the Bank of Russia. The bill was reintroduced to the State Duma in April 2023.

While the Ministry of Finance's support signals progress, the legislative and regulatory complexities suggest that the path to officially recognising cryptocurrency mining in Russia remains challenging and contentious.