Business

Dennis Wafula

After cryptocurrency, Russia’s digital assets bill loses ‘mining’ references

Lawmakers in Russia are making progress on creating regulations to govern blockchain and digital assets-related activities in the country. According to local reports released on October 21, the Russian parliament is almost done with a draft bill titled, “On Digital Financial Assets.”

The bill is expected to give private businesses and legal entities the ability to store digital financial assets on the blockchain. The bill will also allow the creation and sale of these digital assets, which can then be used as a form of digital equity. The head of the Parliamentary Financial Market Committee, Anatoly Aksakov, announced these latest changes and added in a statement that the country’s parliament has removed the term “mining” from the bill. He further explained that the bill will not cover the taxation of mining profits.

These latest changes come less than a week after Russia’s Parliament announced that the term “cryptocurrencies” was removed from the bill. Currently, the bill does not contain any of the main crypto terms.

In explaining the decision to remove the term “mining”, Aksakov stated that it would not make sense to refer to mining in the revamped bill, given that it no longer mentions cryptocurrencies. Initially, the bill had defined “mining” as the process of creating cryptocurrencies and was also recognized as an economic activity in the country. However, the new changes suggest that Russian officials are no longer thinking about integrating crypto activities into their economy.

According to the announcement, the new bill will not handle taxation matters in regards to profits accrued from cryptocurrency trade. Parliament has left this power to the Federal Tax Service, which will decide whether it will tax such operations.

The Russian Ministry of Finance introduced three bills to Parliament for approval in January, all of which were to be approved on July 1. However, numerous changes were made, resulting in a new draft in March. Some of the changes included the updated version of Know Your Customer regulations.

The bill is supposed to pass through a second reading, which was postponed to this fall. In the meantime, the drafts have been compiled into a single legal framework that is completely different from the original version.

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