A new Russian crypto mining law mandates that miners declare their earnings or face jail time and forced labor. Meanwhile, the country has subsidized a mining facility in Siberia.
Russia’s government has issued a new order directing cryptocurrency miners to report earnings or face jail time. Local media outlets have reported that miners will have to declare this income or face up to four years in prison.
Deputy head of the ministry, Alexei Moiseev, sent the order to relevant departments last month, following a meeting with more senior officials in January.
In addition to filing the income, miners must also provide information related to the transactions, namely wallet addresses. The exact sentence, if found guilty, varies depending on how much of an income is earned.
Those who evade a declaration of income of about $200,000 twice in three years will face up to two years in prison and forced labor for up to two years. Those who have earned more than $600,000 will face up to four years in prison and forced labor of the same duration.
The notice also refers to an upcoming regulatory framework for the asset class. Russia is expected to create a register of cryptocurrency exchanges. Those crypto entities who do not follow the framework could face prison time of up to seven years.
Additionally, there was also an amendment to laws with respect to money laundering. Miners must provide information on those involved in the process and other information about the operation.
Russia Opens Crypto Mining Facility in Siberia
Russia has attempted to rein in the mining industry for a long time, as proven by the statements in the notice. However, it has also offered some concessions in recent months. The government provided tax incentives for those interested in mining, helping open a $12 million crypto-mining facility in Siberia.
This mining center will have 30,000 mining rigs and a total power of 100 megawatts. The facility should begin operations in the first half of 2023. Russia’s economy is experiencing heavy damage as a result of economic sanctions, so the mining facility should offer a little relief. It is also launching a state-run crypto exchange to boost tax revenue.
Russia Considering Gold Stablecoins
Russia has also taken other actions to reduce the economic impact of its invasion of Ukraine. It is working with Iran to release a gold stablecoin, hoping to replace the U.S. dollar, Rouble, and Iranian Rial for international payments.
Meanwhile, there are reports that crypto is involved in nefarious activities. Recent reports indicate that false bomb threats in North Macedonia have involved crypto payments to avoid tracking.
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