Putin Approves Crypto Mining Law, Reducing Russia’s USD Dependency

• As part of its foreign policy, the nation is working to lessen its need for the US currency.
• A select group of Russian ministries will formulate more specific regulatory criteria shortly.

A piece of legislation to legitimize Bitcoin (BTC) and crypto mining was adopted by Russian President Vladimir Putin on August 8th. As part of its foreign policy, the nation is working to lessen its need for the US currency.

Approved mining enterprises will be able to register via a state database to mine cryptocurrency after the legislation takes effect in November 2024. If their energy usage stays below a specific level, small-scale, independent miners may also mine cryptocurrencies without formally registering.

Eyeing Unified Currency

Moreover, in the next months, a select group of Russian ministries will formulate more specific regulatory criteria. For the newly authorized mining sector, with the Bank of Russia, the Ministry of Finance, and the rest of the Russian government sharing oversight responsibilities. Additionally, the measure forbade the widespread commercialization of cryptocurrencies inside Russia.

The BRICS group of developing economies—which includes South Africa, Brazil, Russia, India, and China—is actively working to reduce its dependency on the US currency in international commerce.

Despite its popularity and the fact that it has been discussed at length during the 11th Annual BRICS Summit in 2019, the BRICS bloc’s plan for a digital currency has run into many problems. Such as differences in opinion among the bloc’s most powerful members on the best way to implement a unified currency.

In 2023, Russia redoubled its efforts to create a unified BRICS currency. According to reports, State Duma Deputy Chairman Alexander Babakov said that the top members of the new economic bloc were collaborating on a new trade settlement currency.

The Bank of Russia and the Russian government declared their intention to establish special organizations to use digital assets as a means of cross-border settlement shortly after Babakov made his remarks.

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