Russian lawmaker criticizes mining bill

A proposed Russian law introducing criminal liability for illegal crypto mining has drawn criticism from lawmakers. The bill includes up to five years of imprisonment and asset confiscation. However, Anton Gorelkin stated that it lacks incentives for legalization. This is significant as a large portion of mining activity remains outside the legal framework.

Lawmaker highlights lack of incentives in mining bill

Russian lawmaker Anton Gorelkin criticized a draft bill aimed at penalizing illegal cryptocurrency mining. According to him, the proposal focuses on enforcement rather than legalization.

Official estimates suggest around 50,000 miners operate in Russia. However, only about 3% are registered with the Federal Tax Service.

The bill proposes:

• up to five years in prison;
• confiscation of mining equipment;
• stricter oversight of mining operations.

The lawmaker emphasized that the approach relies on pressure instead of incentives.

Lack of consensus deepens regulatory uncertainty

Authorities previously discussed mechanisms to legalize mining equipment imported through gray channels. However, no effective solution has been implemented.

Several regulatory initiatives were considered but failed to gain approval. As a result, the industry remains in a state of uncertainty.

Since November 2024, mining has been legal only:

• for registered legal entities and entrepreneurs;
• for individuals within a 6,000 kWh monthly limit.

Miners are also required to report wallet data and transactions to authorities.

Increased pressure may expand shadow mining

The lack of incentives may influence the structure of the crypto mining market. Some participants may continue operating informally.

Key implications include:

• persistence of shadow mining;
• reduced transparency;
• higher business risks.

Stricter enforcement may also push mining operations to other jurisdictions with more favorable regulations.

At the same time, the Federal Tax Service plans to survey industry participants to identify barriers to legalization.

The industry faces increasing government control

The situation highlights a shift toward stricter crypto mining regulation in Russia. However, enforcement alone may not drive compliance.

The industry requires:

• clear regulatory frameworks;
• legalization pathways;
• predictable energy policies.

Without these elements, tighter regulation may slow market development. As a result, the effectiveness of current measures remains uncertain.

Read also: Russia proposes criminal liability for illegal mining