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Russia to ban crypto mining in occupied Ukraine in December

Russia to ban crypto mining in occupied Ukraine in December

GrafaGrafa2024/11/20 13:37
By:Mahathir Bayena

Russia has announced plans to ban cryptocurrency mining in Ukrainian regions it occupies, including Donetsk, Lugansk, Zaporizhia, and Kherson.

This move marks a significant regulatory measure as the conflict surpasses 1,000 days.

Deputy Prime Minister Alexander Novak led a meeting with top officials to address the country’s energy challenges during the peak autumn and winter periods, with a focus on the impact of crypto mining in areas with limited power supply.

Starting December 2024, a full ban on crypto mining will be enforced in the occupied territories and energy-strained areas such as Irkutsk, Chechnya, and the DPR.

Seasonal restrictions will also be applied to Siberia from December 1 to March 15, 2025, and annually from November 15 to March 15 through 2031.

"Starting Dec 2024, Russia’s Energy Ministry is clamping down on mining rigs in energy-stressed zones like Irkutsk, Chechnya, and DPR. The takeaway’s clear: energy ≠ infinite, and miners might need to get stealthy or pivot," commented Maria Nawfal on X (formerly Twitter).

The Russian government has been reviewing its crypto regulations over the past few months.

While the new measures include regulation of mining pools, support for cryptocurrency as a payment method continues.

Additionally, recent policy changes reclassified cryptocurrency as property for tax purposes.

Income from mining will be taxed at market value at the time of receipt, but miners can deduct operational expenses.

Cryptocurrency transactions remain exempt from value-added tax (VAT), and crypto-related income is taxed under the same framework as securities, capping personal income tax at 15%.

Russia is also advancing plans to establish national cryptocurrency exchanges, expected to be located in St. Petersburg and Moscow.

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