prohibition

Proposed Crypto Mining Ban in Norway Fails to Gain Support in Parliament

13/05/2022 by Idelto Editor

A push to prohibit the energy-intensive proof-of-work mining of cryptocurrencies in Norway has been rejected by the majority of lawmakers. The ban had been suggested by the far-left Red Party which also didn’t win backing to raise an electricity tax for crypto miners.

Norway Will Not Ban Bitcoin Mining

The parliament of Norway has considered and voted against a draft law banning the minting of digital currencies based on the proof-of-work concept. The legislation, which was proposed by the communist Red Party in March, was supported only by two other leftist parties, SV (the Socialist Left Party) and MdG (the Green Party).

“We are obviously disappointed with the majority here,” Red lawmaker Sofie Marhaug told the E24 news portal. She added that the Norwegian society must determine its priorities regarding power usage. Her party says bitcoin mining is extremely energy-intensive and insists on putting an emphasis on the needs of other industries and climate change goals.

However, as Marhaug pointed out, the majority in the Storting, Norway’s legislature, wants to prioritize the market, and “give the bill to Norwegian electricity consumers.”

The Red also failed to win support for a proposal to revise the electricity surcharge for mining data centers, accusing the Labor Party (Ap) and Centre Party (Sp) of breaching a pre-election promise. The two parties had announced they would seek a full electricity fee for mining farms.

While households, many businesses, and the public sector currently pay 0.15 kroner (approx. $0.02) per kilowatt-hour of spent electricity, the industry, including data centers, enjoys a reduced levy of just 0.0055 kroner per kWh.

In February, the Norwegian government said it will try to avoid imposing a crypto ban, but made it clear it was considering various measures regarding the electricity consumption in the sector. In November, Norway admitted it’s mulling over ways to limit the environmental impact of bitcoin minting and may support a Swedish proposal for a European ban on proof-of-work mining.

“In a time of energy scarcity and challenges with cutting emissions, it is particularly harmful that power is wasted only to enrich individuals rather than being used for socially beneficial purposes,” the three leftist parties said. However, the parliamentary majority has objected to the politically motivated discrimination against mining data centers.

What do you think about the debate in Norway on the future of the crypto mining industry? Share your thoughts on the subject in the comments section below.

Russian Regulators Find Common Ground — Bitcoin Can’t Be Used for Payments

13/02/2022 by Idelto Editor

Russian authorities are yet to reach full consensus on the future of cryptocurrencies but government institutions are on the same side of the fence in their intention to ban bitcoin payments. Other operations with digital assets are to be legalized and regulated, representatives of Russian business have revealed.

Russian Central Bank, Finance Ministry Agree to Prohibit Crypto Payments

The Central Bank of Russia, the Ministry of Finance and the government have converged on the question of how to regulate Russia’s crypto space. Decentralized digital currencies will not be accepted as a means of payment, the head of the Russian Union of Industrialists and Entrepreneurs (RSPP) Alexander Shokhin told reporters following a meeting devoted to digitalization.

Last month, Bank of Russia urged for a wide-ranging ban of crypto-related activities, including their use in payments, exchange and mining. The hardline policy proposal was met with opposition from other institutions, including the finance ministry which came up with its own vision of how cryptocurrencies should be treated. Siding with the treasury’s stance, the federal government adopted a plan which favors regulation over prohibition.

“It is already clear that both sides in this discussion have generally come closer. In particular, if we are talking about prohibitions, then that is rather about a ban on the use of cryptocurrency as a means of payment, while other aspects are subject to regulation,” Shokhin was quoted as saying by the daily Izvestia. According to the government-approved regulatory concept, coins can be bought, exchanged, and sold, the report notes.

Vladimir Potanin, co-chairman of RSPP’s Coordinating Council and president of Nornickel, noted that the regulatory bodies are still seeking agreement on the details of Russia’s crypto framework but he emphasized that all of them support a ban on the use of cryptocurrency as a legal tender.

“The business community has reached an understanding with the government, the central bank and lawmakers that cryptocurrencies are more complicated and difficult to regulate than digital financial assets,” the billionaire elaborated, quoted by Forklog.

While regulating certain aspects of the crypto economy such as the issuance of tokens, the Russian law “On Digital Financial Assets,” which went into force in January of last year, left many unanswered questions. A working group at the State Duma, the lower house of parliament, is now preparing legislation to fill the gaps.

A new law introducing comprehensive rules for the circulation of cryptocurrencies in Russia, based on the finance ministry’s proposals, is expected by Feb. 18. Earlier this week, the chairman of the Financial Market Committee Anatoly Aksakov announced that a draft is already on his desk. Deputies plan to adopt it during the spring session of the Duma.

Do you expect Russia to regulate cryptocurrencies by the parliament’s summer recess? Tell us in the comments section below.

Crypto Ban in Russia Can Have Opposite Effect, Medvedev Warns as Opposition Mounts Against Proposal

30/01/2022 by Idelto Editor

Dmitry Medvedev, former president and prime minister of Russia, has voiced his concerns over Bank of Russia’s initiative to ban most crypto operations. Prohibition could bring the opposite result, the Russian politician warned, joining a chorus of opinions against the restrictive policy.

More Officials and Organizations Reject Central Bank’s Call to Prohibit Cryptocurrency

Central Bank of Russia’s proposal to place a number of crypto-related activities outside the law has sparked a wave of reactions in Moscow. Among the critics are the Finance Ministry which put out its own regulatory concept, the State Duma where deputies are working on a new crypto law, and the government which prepared a roadmap for crypto regulation together with various departments.

The central bank’s position has its reasons, Dmitry Medvedev, who now serves as deputy chairman of the Security Council of the Russian Federation, acknowledged in an interview with Russian media. The monetary authority has cited threats to the nation’s financial stability and risks for its citizens as key factors for its hardline stance on crypto. However, quoted by Tass, Medvedev warned:

To be honest, when you try to ban something, this very often leads to the opposite result.

Other Russian officials have recently expressed more specific concerns. Any restrictions on the issuance and circulation of cryptocurrencies would halt the development of the blockchain industry and go against the country’s policy of supporting the IT sector, Minister Of Digital Development Maxut Shadayev was quoted as saying by the business daily Vedomosti. A ban would also lead to outflow of qualified specialists, he added.

The Russian Association for Electronic Communications (RAEC) has also joint the front against Bank of Russia’s push for prohibition while backing the finance ministry and the federal government. A ban would not solve existing problems with fraud and other illegal acts but, on the contrary, it will complicate control as market activity will move to the “grey” sector, the industry organization noted. In a statement quoted by the business news portal RBC, RAEC also said:

The ban on the circulation of cryptocurrencies will leave Russia on the sidelines of the development of one of the fastest growing digital markets at the moment, which will significantly slow down the innovative development of the country.

According to data compiled by RAEC’s experts, the contribution of digital markets to the Russian economy amounted to 6.7 trillion rubles (over $85 million) in 2020. The association’s preliminary estimates for 2021 suggest that the indicator has increased by 29%, to 8.6 trillion rubles (around $110 million at current exchange rates).

Meanwhile, the head of the State Duma Financial Market Committee, Anatoly Aksakov, has publicized the idea of legalizing cryptocurrencies under the Russian law “On Experimental Legal Regimes in the Field of Digital Innovations.” This would allow authorities to examine how the various elements of the crypto infrastructure function under strict government control, Aksakov elaborated during a conference devoted to crypto regulations.

Do you think Russia will eventually legalize cryptocurrencies and operations with them? Share your expectations in the comments section below.

Russians Aware of Bitcoin Divided on Proposed Crypto Ban, Poll Finds

30/01/2022 by Idelto Editor

A new survey has indicated that Russians who have heard about cryptocurrency are deeply divided in their opinions on the recently suggested ban on operations with digital assets. A third of the respondents support the central bank’s proposal while an equal number of participants in the survey oppose it.

Bank of Russia’s Call to Prohibit Cryptocurrencies Backed by 32% of Russians Who Know Bitcoin

Amid ongoing discussions on the future of digital currencies, the Russian Public Opinion Research Center (Vtsiom) has published a new study measuring the attitudes of Russian citizens towards crypto assets and operations with them. It comes as officials are trying to put the country’s crypto space in order, not without disagreements between regulators.

According to the poll, the majority of Russians (64%) have heard about bitcoin and 17% have good knowledge of the cryptocurrency, an increase of four percentage points in comparison with the data from a 2017 survey. The share of those who are totally unaware of its existence has shrunk by 11 points to just 19%.

According to the Russian Association of Cryptoeconomics, Artificial Intelligence and Blockchain (Racib), over 17 million Russians have cryptocurrency wallets. Russian citizens have invested 5 trillion rubles in crypto (over $67 billion), the head of the State Duma Financial Market Committee, Anatoly Aksakov, announced in December.

The growing popularity of cryptocurrencies has forced Moscow to take steps to regulate the market. Citing threats to the nation’s financial stability and risks for its citizens, Bank of Russia proposed a blanket ban on a range of crypto activities including the issuing, using, trading, and mining of coins like bitcoin. The prohibition has been opposed by other institutions and the government has reportedly prepared a roadmap to regulate, not ban crypto operations.

Equal numbers of crypto-aware Russians now support and reject the central bank’s idea (32% each), the survey conducted by Vtsiom has shown. A similarly sized group of people, 33%, remain indifferent towards the regulator’s attempt to ban crypto-related transactions. A majority of the young, 54% of those aged 18 – 24 and half of the 25 to 34-year-olds, disagree with the monetary authority. On the other end of the spectrum are those aged 60 and over, among whom only 15% are against the ban.

Despite the annual volume of crypto transactions made by Russians reaching $5 billion, according to Bank of Russia’s own estimates, 81% of the respondents do not wish to acquire cryptocurrency against 16% who said they wanted to buy. Over half of the participants in the study (56%) still think bitcoin is a bad investment while one in five questioned (22%) view it as a good option.

The majority of Russians familiar with bitcoin admitted that neither they nor those they are close to had ever bought cryptocurrency (74%). A fifth of the polled revealed their relatives or friends had bought bitcoin (21%) and 4% purchased cryptos themselves. At the same time, more Russians (38%) believe a crypto stash is harder to steal, while those who feel fiat holdings are safer came out to 27%.

What do you think about the findings in the survey and the proposals to regulate the Russian crypto sector? Share your thoughts on the subject in the comments section below.

Russian Government Drafts Roadmap to Regulate, Not Ban Crypto, Report Unveils

29/01/2022 by Idelto Editor

A roadmap on cryptocurrencies has been prepared by a number of ministries, regulatory bodies, and law enforcement agencies, Russian media reported. The document, which aims to regulate Russia’s crypto market by the end of this year, comes amid disagreements between the central bank and other government institutions about the future of decentralized digital money in Russia.

Moscow Moves to Adopt Rules for Cryptocurrencies After Putin’s Call

Soon after Russian President Vladimir Putin urged government officials to reach a consensus on how to regulate cryptocurrencies, Deputy Prime Minister Dmitry Chernyshenko has reportedly signed a roadmap to regulate, rather than ban, crypto operations in Russia as early as this year. The business news portal RBC broke the news, quoting a copy of the document and a source close to the working group that produced it.

According to the report, the plan has been drafted by representatives of the ministries of finance, economic development and digital development, the country’s financial watchdog and revenue service, as well as the Central Bank of Russia (CBR). The Prosecutor General’s Office and the Federal Security Service (FSB) also took part in the process.

The goals listed on the roadmap have been supported by all participants, except the CBR. Last week, Bank of Russia shared its view on the matter in a consultation paper. It called for imposing a blanket ban on crypto-related activities, including payments, exchange and mining, citing threats to the nation’s financial stability and risks for its citizens.

The monetary authority’s hardline stance was met with opposition from other Russian institutions. The Finance Ministry insisted that prohibiting cryptocurrencies is impossible and regulation is needed to limit the risks and increase budget revenues through taxation. Ivan Chebeskov, who heads the ministry’s Financial Policy Department, emphasized:

Regulation will only provide the transparency that will ensure the protection of citizens.

Regulations Proposed by Russian Finance Ministry Deemed Compliant With FATF Standards

The treasury department put out its own regulatory concept. It suggests that all crypto-related transactions should be carried out through licensed Russian banks and registered exchanges and calls for introducing identity verification for Russian crypto owners. Minfin’s ideas were backed by Rosfinmonitoring, Russia’s financial watchdog. Quoted by Tass, the agency noted that “the proposal is conceptually compliant with the FATF standards.”

In accordance with the roadmap, the Ministry of Finance is expected to establish a control system for organizers, operators, and clients of peer-to-peer platforms by May. Financial authorities will also develop a regulatory regime for crypto service providers, determine the legal status of market participants and appoint a regulatory body.

By November, the FATF standards pertaining to virtual assets should be transposed into the Russian regulatory framework. And by December, the registration and reporting mechanisms concerning organizations facilitating the circulation of digital currencies in the Russian Federation must be finalized.

The next step will be to introduce legal liability for crimes involving cryptocurrencies, including administrative or criminal liability for evading the declaration of crypto transaction data. The government also wants to put in place a mechanism to verify the accuracy of the filed information on the ownership of digital assets. Reporting obligations will be incorporated into a new law.

Meanwhile, the Financial Market Committee at the State Duma, the lower house of Russian parliament, has started working on a bill to regulate cryptocurrencies, its Chairman Anatoly Aksakov told RIA Novosti. Once the draft legislation is finalized, it will be presented to the Finance Ministry and Bank of Russia for further discussion, the high-ranking deputy added.

Do you think Russia will implement the roadmap for cryptocurrency regulation? Tell us in the comments section below.