A top official hailing from the Russian Ministry of Finance recently said that there does not seem to be any point in imposing a ban on cryptocurrency mining in households because it would be extremely difficult to restrict this activity. The high-ranking representative of Minfin also disclosed that the department was working on coming up with regulations that would be applicable to the mining sector, as this would help them in legalizing the crypto sector in the country. These statements came from Alexey Yakovlev, who is the Financial Policy Department’s deputy director. He does not believe it is practical to prohibit at-home crypto mining and he expressed his sentiments at a round table discussion that was held to talk about regulation and legalization of the industry in Russia.
In a video conference call, the deputy director disclosed that they were working on new provisions that would help in legalizing the crypto mining activity in the country. Authorities in Moscow are interested in ensuring the economic feasibility of the activities that are conducted in this space. Furthermore, it is also the aim of the Russian government to keep the risks minimum as much as possible. The representative for the Ministry of Finance highlighted that there were risks of money laundering and terrorism financing that would have to be addressed.
He further added that they also needed to ensure the energy security in the country because crypto mining takes up a lot of energy. A number of ordinary Russian citizens have begun to partake in crypto mining in garages and basements at home in order to earn some income. This is particularly true for regions like Irkutsk in Russia, as these have low electricity rates, which begin as low as $0.01 per kWh. Data showed that there had been an increase in power consumption in the region last year by nearly four times.
According to authorities, this increase in power consumption is mostly because people are using mining equipment in their villas and homes. Back in December, Russian regions were granted the authority by Moscow’s central government to determine the local electricity rates that would apply to residential areas. This will give utility companies and regional authorities’ room for implementing higher tariffs for households that use electricity over a certain threshold. Russia has renewed its efforts to regulate the crypto space, as the sanctions that have been imposed on it has greatly restricted its access to the international financial market.
Crypto assets could provide Russia with a way to restore its access, but the central bank in the country has been heavily opposed to regulating the crypto space. In contrast, other government sectors, including the Ministry of Finance, have stated that it is better to regulate the industry and monitor it strictly. The two sides were told to put their differences to rest in January by Vladimir Putin. There have been calls from the officials to legalize crypto mining and declare it as an entrepreneurial activity. The Ministry of Energy also asserted this week that they needed to get this done as soon as possible.