In a landmark move for the global crypto industry, Russia has taken a decisive step toward formalizing its stance on cryptocurrency mining. On July 30, 2024, the State Duma—the lower house of Russia’s legislature—passed the 237585-8 legislative amendment in its third and final reading. This bill establishes a comprehensive legal framework for cryptocurrency mining and digital asset transactions within the country.
While the law still requires approval from the Federation Council and presidential signature, it is expected to take effect on November 1, 2025, at which point cryptocurrency mining will become officially legal in Russia—provided operators comply with new licensing and regional restrictions.
This development marks a pivotal shift in Russia’s approach to blockchain technology and digital finance, offering new opportunities for miners, infrastructure providers, and investors seeking stable regulatory environments.
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Overview of the Cryptocurrency Mining Bill
The newly passed legislation introduces formal regulations by amending three key legal documents:
- The Federal Law on Electric Power Industry (Electricity Law)
- The Decision on Amendments Due to the Electricity Law
- The Decision on Digital Financial Assets, Cryptocurrencies, and Related Legal Amendments
These changes collectively create a structured environment for cryptocurrency mining operations while addressing energy usage, national security, and financial oversight concerns.
Key Provisions of the Law
- ✅ Legalization of Cryptocurrency Mining: Mining is now recognized as a legitimate economic activity in Russia.
- ✅ Individual Participation Allowed: Russian citizens can mine cryptocurrencies as long as their energy consumption stays below government-defined thresholds.
- ✅ Licensing Framework Established: Legal entities and registered individual entrepreneurs must obtain licenses and be listed in official registries to operate.
- ✅ Authorized Activities Include: Cryptocurrency mining, operation of mining infrastructure, and management of mining pools.
- ❌ Penalties for Non-Compliance: Unlicensed mining or operations in prohibited zones may result in forced disconnection from the power grid and financial penalties.
- 🚫 Prohibited Integration: Mining cannot be combined with power generation, transmission, distribution, or energy trading activities.
This balanced regulatory model aims to harness the economic potential of blockchain while mitigating risks related to energy grid stability and illicit financial flows.
Amendments to the Electricity Law
The Electricity Law has been updated to address the unique demands cryptocurrency mining places on Russia’s power infrastructure.
Grid Access Restrictions
Under Article 26, grid operators previously could not deny technical connection requests without cause. The amendment adds two critical exceptions:
- Specialized Equipment Exclusion: Grid operators may restrict access for devices used specifically for cryptocurrency mining—especially in regions where mining is banned.
- Registry-Based Eligibility: Only individuals or entities listed in the official Cryptocurrency Mining Participants and Infrastructure Operators Registry are eligible for grid connection.
“Operators may deny grid access to unregistered miners or those operating in restricted areas.”
Mandatory Disconnection Orders
A new Article 26(9) empowers courts to order the permanent disconnection of mining equipment operating illegally. Furthermore, any fees paid for technical connection will not be refunded, increasing the financial risk of non-compliance.
Power Supply Adjustments
Article 28 now requires miners who were connected before the law’s enactment—but are located in prohibited areas or lack proper licensing—to revise their power supply agreements.
Additionally, under Article 38, during periods of energy shortage threatening national grid stability, authorities can impose:
- Partial or full electricity restrictions on mining operations
- Indefinite bans on unlicensed or regionally non-compliant miners
These provisions ensure that public energy needs take precedence over commercial mining activities.
Regulatory Framework Under the Cryptocurrency Amendment
The Digital Financial Assets and Cryptocurrency Law has been significantly expanded to define key concepts and establish oversight mechanisms.
New Definitions Introduced
The bill clarifies critical terms such as:
- Cryptocurrency mining
- Mining pool
- Pool organizer
- Mining infrastructure
- Infrastructure operator
- Address identifier
These definitions lay the foundation for consistent enforcement and compliance monitoring.
Government Authority Over Mining Zones
Under the revised Article 14, the Russian government gains authority to:
- Regulate entities organizing mining pools
- Ban mining activities in specific regions based on energy or security considerations
- Empower anti-money laundering (AML), counter-terrorism financing (CFT), and tax oversight agencies to monitor compliance
This centralized control allows flexible policy responses based on regional energy capacity and national interests.
Licensing System: Two-Tier Registration Model
A cornerstone of the new law is the introduction of a dual licensing system through Article 142:
1. Cryptocurrency Miner License
Eligible to:
- Registered individual entrepreneurs (IPs)
- Legal entities under Russian law
Once listed in the registry, these participants can legally mine cryptocurrencies—including participation in mining pools.
2. Mining Infrastructure Operator License
Available only to:
- Russian legal entities
- Individual entrepreneurs
License holders may operate data centers, manage hardware farms, and provide colocation services for miners.
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Exemptions for Individual Miners
Russian citizens who are not registered as entrepreneurs can mine without registration—if their electricity usage remains below government-set limits. This provision supports grassroots participation while preventing large-scale unregulated operations.
Who Is Prohibited from Mining?
Certain individuals and organizations are barred from engaging in mining activities:
- Those with unresolved criminal records in economic crimes, state security offenses, or serious intentional crimes
- Entities or individuals on terrorism or extremism watchlists
- Organizations subject to asset freezes by financial intelligence units
These restrictions align with broader AML/CFT and national security frameworks.
Responsibilities of Miners and Pool Operators
All miners—including pool participants—must report received cryptocurrency to authorized Russian government agencies. Required information includes:
- Transaction details
- Wallet address identifiers
This transparency measure enhances traceability and supports tax compliance.
The government will also designate a federal executive body responsible for:
- Maintaining both registries
- Implementing IT policy in the digital asset sector
- Enforcing regulatory standards
Special Rules for Mining Pool Operators (Article 143)
Organizations or individuals managing mining pools must meet one of these criteria:
- Be a Russian legal entity
- Be a registered individual entrepreneur
- Be a non-business Russian citizen
Pool operators may also engage in direct mining activities, allowing integrated business models.
Why This Matters: Strategic Implications for Global Miners
Russia’s move comes amid growing geopolitical pressure following Western sanctions after 2022. With limited access to traditional financial systems, Moscow sees digital assets as a strategic tool for economic resilience.
By legalizing and regulating mining, Russia aims to:
- Attract foreign investment in data centers and green energy projects
- Utilize excess hydroelectric and nuclear power in remote regions like Siberia
- Position itself as a compliant hub in the global crypto mining map
For international miners, this presents both opportunity and caution:
- Favorable energy costs and clear regulations could reduce operational risks
- But strict licensing, surveillance requirements, and political volatility remain concerns
Frequently Asked Questions (FAQ)
Q: When will cryptocurrency mining officially become legal in Russia?
A: If fully ratified, the law will take effect on November 1, 2025.
Q: Can foreigners operate crypto mines in Russia?
A: Foreign-owned legal entities can apply for licenses, but must comply with local registration and reporting rules.
Q: Are there regions where mining is banned?
A: Yes. The federal government has the right to prohibit mining in areas where it threatens grid stability or violates regional policies.
Q: Do I need a license if I mine at home?
A: Not if you're a Russian citizen using less than the government’s energy threshold. Otherwise, registration is required.
Q: Will mined crypto be taxed?
A: While this law focuses on regulation, tax obligations will likely be governed separately under income or capital gains rules.
Q: Can I join a mining pool without being licensed?
A: Yes—as long as you’re an individual miner staying under the energy limit. However, pool organizers must be licensed.
Final Thoughts: A New Era for Crypto Mining in Russia
The passage of this bill signals Russia’s intent to integrate into the global digital economy on its own terms. By combining legalization with strong regulatory controls, the country offers a structured path for compliant mining operations.
For industry players evaluating international expansion, Russia now emerges as a regulated—but complex—mining destination. Success will depend on navigating licensing processes, adhering to energy policies, and maintaining transparency with authorities.
As global crypto regulation evolves, staying informed is essential.
👉 Stay ahead of regulatory shifts and discover secure ways to grow your digital assets today.