New Crypto Mining Bill in Russia Mandates Earnings Reports

A new crypto mining bill in Russia mandates that miners declare their earnings or face jail time and forced labor. Meanwhile, the country has subsidized a mining facility in Siberia.

The Russian government has issued a new regulation requiring cryptocurrency miners to record their revenues or risk prosecution. According to local media, miners will be required to register their earnings or face up to four years in prison.

Following a meeting with more senior officials in January, Deputy Minister Alexei Moiseev issued the directive to relevant departments last month.

Miners must give information on transactions, such as wallet addresses, in addition to disclosing their revenue. If found guilty, the actual penalty varies depending on how much money is earned.

Individuals who fail to declare their income of around $200,000 twice in three years risk up to two years in jail and two years of forced labor. Individuals who have earned more than $600,000 risk up to four years in jail and four years of hard labor.

In addition, the notification mentions an impending regulatory framework for the asset class. Russia is likely to establish a bitcoin exchange registry. Crypto companies that do not adhere to the framework may face up to seven years in prison.

There was also an update to the legislation governing money laundering. Miners are required to disclose information on persons participating in the process as well as other details about the activity.

Russia Opens Crypto Mining Facility in Siberia

Russia has long sought to control the mining industry, as evidenced by the comments in the notice. Yet, in recent months, it has made some compromises. The government offered tax breaks to people interested in mining, assisting in the establishment of a $12 million crypto-mining plant in Siberia.

This mining center will feature 30,000 mining rigs and 100 megawatts of total electricity. The facility is expected to open in the first half of 2023. Russia’s economy is suffering as a result of economic sanctions, thus the mining facility might provide some respite. It is also developing a state-run cryptocurrency exchange in order to increase tax income.