Crypto Mining Hardware Sales ‘Triple’ in Russia as Moscow Teases ‘Light Touch’ Regulation
According to Sergey Bezdelov, the head of the Industrial Mining Association, crypto mining hardware sales in Russia have tripled compared to the previous year. Bezdelov stated that in the fourth quarter of 2024, the demand for industrial mining equipment and services increased threefold compared to the same period in FY2023. This surge in sales comes after comments from a top lawmaker suggesting that Moscow may soften its stance on crypto regulation.
Bezdelov also mentioned that there is high interest in Russian crypto mining projects among foreign market participants, particularly from fellow BRICS member states. He previously claimed that the Russian industrial crypto mining market doubled in size in 2023 and hinted that recent legal changes have contributed to the growing popularity of mining in Russia.
A new law that came into effect on November 1, 2024, allows both private companies and private citizens to mine crypto legally if their energy consumption does not exceed 6,000 kWh per month. Individuals can mine crypto without being included in a state-run register as long as they stay within this energy consumption threshold. However, if they exceed this threshold, individuals must register as an individual entrepreneur and apply for inclusion on the register.
Currently, the register only requires companies and individuals to submit data on transactions and energy consumption. However, as the body controlling the register also manages Russia’s taxation system, it is likely that miners using more than 6,000 kWh will soon be required to pay taxes on their earnings. Before the legal change, crypto mining existed in a legal gray area, but it is now recognized as a form of entrepreneurship under Russian law.
Although most domestic miners in Russia focus on Bitcoin, there is evidence suggesting that many home-based miners prefer Ethereum. Litecoin is also popular among a smaller group of Russian miners.
Russian media outlets have changed their tune on crypto, now considering mining as a good source of additional income and an opportunity to diversify assets. It is even suggested that crypto can be used as a settlement tool in foreign economic activities within the Central Bank’s sandbox. This positive perception of crypto was once unheard of in Russian mainstream media.
President Vladimir Putin led a crypto pivot in Russia when he started speaking positively about crypto mining. While some energy-poor areas have banned crypto mining until 2031, Putin is encouraging other parts of Russia to mine crypto if they have surplus energy. The Industrial Mining Association claims that the Russian Treasury could earn over $500 million per year from taxing crypto miners, and Russia’s desire to become an AI powerhouse may have inspired Putin’s crypto pivot.
Anatoly Aksakov, the Chairman of the State Duma’s Committee on the Financial Markets, has allowed for the possibility of softer regulation for domestic companies using crypto to avoid sanctions from the US, UK, and EU. He stated that crypto market players are complaining about over-regulation in the Central Bank’s sandbox and suggested the need for a simplified turnover of cryptocurrencies to facilitate successful market development. Aksakov proposed the launch of an experimental sandbox and adjusting regulations accordingly, possibly moving towards a softer regulatory position.
