Bitcoin - Favorable Legal Framework in Russia

Encouraging signals are accumulating in Russia recently. The Ministry of Finance wants a legal framework that is favorable to bitcoin.

Bitcoin? Yes!

The Russian Ministry of Finance proposes treating bitcoins mined on the territory of the Russian Federation as an exportable commodity.

This would allow for circumventing complex currency control laws and other legal hurdles in order to simplify transactions. This proposal was made by Finance Minister Ivan Chebeskov during a roundtable discussion on the future of digital finance in Russia.

The minister reminded that his ministry and the Central Bank have taken a joint position to recognize the bitcoin industry as an industry in its own right. Both institutions even agree that it can be used to settle international transactions.

A bill is expected in the spring, for implementation before the end of the year 2024. These significant changes could have profound repercussions on bitcoin’s role in the Russian economy.

By equating the bitcoin industry to the extraction of natural resources, Russia could become a key destination for miners. Especially since the country has many advantages to offer in addition to a favorable legal framework.

BITCOIN REGULATIONS RUSSIA
Recent reports from Russian sources confirm that the Russian Ministry of Finance has proposed an innovative approach to treat domestically mined cryptocurrency, particularly #Bitcoin, as an exportable commodity.
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— 𝕿𝐡𝐞 𝕮𝐨𝐬𝐬𝐚𝐜𝐤 (@GhostOfPashka) December 14, 2023

Biriver sets its sights on flares

According to miner Bitriver, Russian oil companies are increasingly interested in bitcoin. It would enable them to monetize the gas otherwise wasted (burned via flares) due to the inability to transport it to civilization.

Bitriver CEO Igor Runets estimates that the bitcoin industry could recycle up to 10 billion cubic meters of gas per year. That’s about half of the volume currently burned in flares each year.

This could potentially move them up in the ranking of nations in terms of hashrate. According to estimates from the University of Cambridge, Russia is in fifth place. Ahead are Canada (6.5%), Kazakhstan (13%), China (21%), and the United States (38%).

However, regulatory pressures and rising energy costs in the United States as well as Kazakhstan could lead to a new migration. Russian analysts estimate that Russia has what it takes to occupy up to 18% of the global hashrate.

All this is paralleled with Russia’s disconnection from the SWIFT network.
The Russian president recently stated he is relying on new technologies for international transactions, specifically the blockchain.

Was this a nod to bitcoin?