Ban Crypto, But Legalize Mining and Issue Gold-Backed Stablecoin, Russian Top MP Urges

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Source: Adobe Stock / evgris

Russian parliamentarians, government officials and finance chiefs remain deeply divided on the issue of crypto regulation – with a top lawmaker indicating that crypto mining may soon be legalized, alongside a stablecoin state-run and gold-backed, while supporting the idea of ​​banning crypto trading and investing. The news comes shortly after the Central Bank’s recent proposal suggesting a ban on crypto and token mining.

There’s nothing particularly new about the Central Bank’s stance – the institution and its Governor Elvira Nabiullina remain staunchly opposed to anything crypto and have repeatedly called for various forms of crypto bans. , including a Chinese-style crackdown on mining and trading rigs ahead of the release of its own digital ruble.

However, his latest announcement, made at the end of last week, caught the attention of much of the international media. In fact, enacting a crypto ban would force the central bank to win over parts of government that remain staunchly pro-business — at a time when Russian companies are increasingly turning their attention to mining and mining-related activities. tokenization.

Lenta, citing RIA Novosti, reported that Chairman of the State Duma’s Industry and Trade Committee Vladimir Gutenev said that crypto mining in Russia could be prosecuted and legalized, but “only if it is placed under strict state control”. He explained that this would mean that all crypto miners would have to be “absolutely transparent, pay all taxes, and operate in regions that produce excess electricity” or have climatic factors that “make cooling less energy-intensive.”

The industry itself has urged the government to legalize mining as soon as possible – although such a move would likely only benefit industrial miners.

However, Gutenev supported the Central Bank in one regard, backing a “ban on the free circulation” of coins in Russia. He said crypto-assets are risky “for inexperienced and unskilled investors who might use leverage” to make investments. He claimed that the volatility in the crypto market could wipe out investments and put people in debt.

Prime quoted Gutenev explaining:

“Cryptocurrencies should be banned, but we could have an alternative financial product – a kind of stablecoin, denominated in gold and fully controlled by the state. This would be interesting for both natural and legal persons. It would be [like a digital version] gold rouble.

The lawmaker said he had “already discussed the matter” with Nabiullina.

Either way, such proposals would require the support of the Duma and the government, both of which remain divided on the issue of crypto regulation. More concrete indications of the direction of Russian crypto regulation will likely emerge next month, when a government-parliament-business-central bank working group on crypto convenes for its second meeting.

“Throw the baby out with the bathwater”

The Central Bank’s call for a ban has angered the man known as Russian Mark Zuckerberg – Pavel Durov, the founder of social media platform VKontakte (aka VK) and Telegram.

Durov posted on his Telegram account to remark that “no developed country has banned cryptocurrencies.”

He added that the “reason” why other nations would not consider such a possibility was that “such a ban would “inevitably slow down the development of blockchain technology.”

“This technology,” he noted, “enhances the efficiency and safety of many forms of human activity, from finance to the arts.”

He warned regulators they would “throw the baby out with the bathwater” if they pursued a ban, and said:

“Russia is currently one of the leaders in terms of the number of highly qualified specialists it produces in the blockchain industry. Carefully considered regulations will allow [Russia] balance the distribution of [power] in the international financial system and become a major player in the new economy.

In comments shared with Cryptonews.com, Igor Runets, the CEO of Irkutsk-based mining player BitRiver, claimed that “all conscious subjects of the cryptocurrency industry in the Russian Federation are interested in comply with all KYC (know your customer) principles and anti-money laundering and anti-terrorist financing legislation.

He claimed that “about 300,000 people” currently mine bitcoin (BTC) in Russia, earning $1.5 billion a year, with altcoin miners earning $2.5 billion. If the government legalized and taxed minors, it could expect to make “about $650 million” a year, the CEO claimed.

He added:

“Plans to ban the possession of cryptocurrency by Russian citizens have been repeatedly announced by the Bank of Russia. However, the hard option is unlikely to be adopted and a constructive dialogue with the actors of the market should be [developed]. Russia now has a real opportunity to become a world leader in digital financial technology.

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