Russia’s Ministry of Energy Pushes to Legalize Crypto Mining

Russia’s Ministry of Energy is pushing for the legalization of industrial crypto mining, and wants lawmakers to press ahead with a much-anticipated mining-related bill.

Per the Russian news agency Tass, the ministry made the comments at the weekend, during the St. Petersburg International Economic Forum.

Pavel Snikkars, the Energy Vice Minister, said that the ministry “supports” the legalization of mining and “expects” lawmakers to approve “the introduction of taxation for miners.”

Snikkars said:

“We want [crypto] miners to be recognized as a category of [energy] consumers. We hope that taxation will also be introduced for this category of consumers. It is important for us to be able to identify [crypto miners].”

The Vice Minister added:

“We understand that certain regulatory features will have to be introduced for [crypto miners].”

Russian Energy Ministry: Time to Legalize Crypto Mining

Snikkars added that the Ministry of Energy was also planning to propose “certain restrictions” on the “generating capacities” made available to miners.

A number of crypto mining hotspots have sprung up in Russia in the past few years.

Perhaps the most notable of these is the Irkutsk Oblast in Siberia, which has entered into a somewhat complicated relationship with crypto mining.

The Irkutsk authorities have complained that miners are placing a strain on local energy resources, but have conversely seemed keen to allow some form of industrial mining to flourish.

Much of the problem centers around the fact that crypto mining is not recognized as an industry in Russia.

As such, in most situations, energy firms cannot charge miners at industrial rates.

Instead, many miners are charged at (subsidized) residential rates.

The ministry has attempted to intervene while lawmakers drag their feet, allowing energy providers to identify miners and bill them at higher rates.

But this imperfect solution has been found lacking.

And the ministry instead proposes creating a special crypto mining rate, which would be separate from both industrial and residential rates.

Miners themselves have long called for Moscow to “hurry up” and legalize their industry.

This Russian forum is super important. The BRICS' version of Davos. The description of the video says that Russia is no2 in the world in crypto mining, with only USA being no1. https://t.co/xWQ3AfzpQI pic.twitter.com/sqwwNPXQ1i

— Shimon ₿/acc (@ShimonLazarov) June 16, 2023

The Vice Minister warned that “the whole country” could “pay” if miners were allowed to continue unchecked.

Snikkars concluded:

“[We will ensure that] the needs of this particular category of energy consumers is represented with regulation and legislation. And we will try to bring stability to this situation.”