Cryptocurrency miners who illegally plug their equipment into electricity should go to jail, says a Russian lawmaker, which recently announced that its nationalist party is working on a bill to regulate crypto activities. The industry could not rely on government support, added another high-ranking MP.
Unauthorized use of electricity could put miners behind bars
The problem of regulating cryptocurrency mining is looming in Russia and the legislature has actively discussed the issue. Andrey Lugovoy, a member of the lower house of parliament, the State Duma, has threatened miners with jail if they plug their hardware into the power grid without official authorization.
If mining is to become legal, miners should contact their utility before turning on their equipment, the MP said. And if they are denied access, but they still connect to the distribution network, they are violating both the administrative and criminal codes of the Russian Federation, he said.
Lugovoy revealed in November that the Liberal Democratic Party of Russia, the nationalist faction of which he is a member, was preparing to present a bill to regulate crypto mining. The legislature emphasized that the passing of the law will benefit Russian citizens, the state itself and entrepreneurs who want to get involved legally in the business.
In an interview with the Russian online news portal Lenta.ru, he added that regulation of mining would make sense. In addition to introducing differentiated electricity tariffs for mining companies, the MEP believes that their profits should be taxed after deducting the cost of energy used and other costs such as labor costs. Lugovoy accused miners of consuming cheap, subsidized electricity without paying taxes.
Cryptocurrency Mining Believed to have “no concern”
Bitcoin miners shouldn’t expect government support as their activity has “no social impact”. This emerges from a statement by the chairman of the parliamentary financial market committee, Anatoly Aksakov, who also commented on it. The senior legislature is one Advocates regulate mining as a business activity and its taxation as such.
Aksakov announced that the Duma will host the first session of the a Working group on cryptocurrency regulation in December. It starts with a review of a special report from the Central Bank of Russia (CBR) and its members will focus on expanding the legal framework for cryptocurrencies. The Russian law “On Digital Financial Assets” only regulated some crypto-related activities earlier this year and mining was not one of them.
Amid an ongoing crackdown on Bitcoin mining in China, energy-rich Russia has become a major target for mining companies as it received the majority of China’s mining equipment during this year’s miner exodus, according to a recent report report. Members of the crypto industry believe moderate regulation could help the country become a leader in the sector. Authorities in regions such as Irkutsk, which has some of the lowest electricity prices in the country, complained that excessive consumption by illegal miners is causing electricity bottlenecks.
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Source: Crypto News Austria