Demand for Bitcoin mining machines tripled in Russia during the fourth quarter of last year compared to the same period in 2023. According to local media outlet Prime, the increase is due to the country’s decision to legalize mining. Bitcoin mining in 2024.
Bitcoin mining became legal in Russia in November 2024 after late Vladimir Putin signed a law legalizing the activity in late 2024. The law ended years of regulatory uncertainty around mining activity and allowed for the industry to prosper in the country..
According to Hashrate Index data, Russia ranks second in Bitcoin, accounting for 16% of the global hashrate market share as of December 2024. This is significant compared to the 4.66% hashrate share in Hashrate Index data. Cambridge Center for Alternative Finance.
The growth of Russia’s Bitcoin mining sector is not surprising, given its energy resources and the flexibility of its new mining law. Under the law, any person or entity using less than 6,000 kWh per month to mine BTC is not required to register, while those using more must register.
In addition to allowing mining, the country also amended its tax law to accommodate BTC mining with a 15% tax imposed on mined assets based on their value at the time of mining. With this regulatory clarity, industry experts say there is renewed interest from individuals and institutions in the country to invest in Bitcoin .
Serge Bezdelov, director of the Industrial Mining Association, said at Prime what Bitcoin offered an opportunity for asset diversification. He said interest in mining Bitcoin doesn’t just come from residents dent but also foreign investors, including those from BRICS countries.
Nonetheless, Russia continues to balance its need for energy security with Bitcoin mining and is exercising caution regarding Bitcoin mining. Its ban on Bitcoin mining in the six regions of the North Caucasus and its seasonal restrictions in four other regions took effect on January 1, 2025.
Bank of Russia imposes reporting rules on foreign crypto transactions
Despite the permissiveness of cryptocurrencies and Bitcoin in Russia, regulators still maintain strict control over activities, including foreign transactions. The Bank of Russia recently issued new regulations requiring registration of foreign trade transactions involving digital rights.
-According to the regulations that came into effect on January 11, digital rights include tron records such as cryptocurrencies, digital assets and tokenized securities. With the regulations now in effect, countries in the country must register any foreign trade transactions involving digital assets with an authorized bank.
However, there is a reporting threshold of 3 million rubles ($29,197) for imports and 10 million rubles ($97,352) for exports. By setting a threshold, the regulator aims to maintain its monitoring without imposing an unnecessary reporting burden on businesses and individuals.
The regulations read as follows:
“Foreign trade contracts, including those providing for settlements using digital rights, must be registered with authorized banks. The thresholds for recording these scares have remained unchanged.”
Meanwhile, regulations, policies, and even public statements from Russian authorities over the past year underscore the extent to which the country has moved from an ambivalent attitude toward crypto to a search for ways to enable industry. This is likely influenced by the plethora of Western sanctions against it due to its invasion of Ukraine and its desire to become less dependent on the US dollar by adopting BTC. The country’s Finance Minister, Anton Siluanov, revealed a few weeks ago that his companies were using Bitcoin for cross-border transactions.
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