Topic: Russian Ministry wants to legalize Bitcoin mining in specific areas - page 3. (Read 664 times)

If Russia is accepting Bitcoin as a currency, that means it can be used for buying and selling and other things related to legal tender, but due to high Bitcoin transaction fee, this is not going to be possible and the banks and laws in Russia about this will make sure Bitcoin do not dominate or affect Russian local currency, most people will see Bitcoin as an asset rather than as a currency. There will be no law about it to make bitcoin a legal tender and not making it a compulsory means of payment but an alternative. I like the moves of Russian government towards achieving this.

I think it would be more important that Russia ends up legalizing Bitcoin. Somewhere I read that it could be as legal tender, although without obligation to accept it as in El Salvador. If this were to happen, I think it would boost a mining industry in Russia, but let's wait for developments, it won't be long before we know more concretely.

China did stop mining although the one's owned by the government didn't really stop because China wants all the bitcoin for themselves, pretty sure that they're not going to simply let go of that opportunity, not to mention that China is known to lie in their announcements or take back what they've said immediately without the public knowing.

Central Bank Chief Nabiullina Digs Heels in Over Russian Plan to Legalize Crypto
https://www.bnnbloomberg.ca/central-bank-chief-nabiullina-digs-heels-in-over-russian-plan-to-legalize-crypto-1.1723556

"(Bloomberg) -- Top government officials failed to reach an agreement on how to regulate cryptocurrencies at a meeting Tuesday, according to people familiar with the talks, despite President Vladimir Putin’s request for them to find a compromise. "

It is good news to regulate this kind of Bitcoin mining legalization even only in several certain areas. But the next question is what about others? Still, banned or ilegal? ANd how if the mining activities in certain areas are growing very masively? Wil the regulation be revised again and again and they will change the news again like previously?
We know that the law and news about crypto industry in the country is sometimes confusing because they often legalize and but on the other hand soemtimes changing to be ilegal and spreadinf FUD.
Hopefully this will not happen again.

I don't think they are doing this to create centralization. More like to keep power usage under control or something similar.
I doubt they will ask for miner addresses and other stuffs so they can track miners. Even if they ask for miners address, the miners can change their address or also mine using a different address and the government will never know. They will have to trust that their bitcoin miners will report their earnings to the Federal Taxation Service. Small mining business can go under the radar and hide, but big business won't be able to do that and will have to report their earnings.

Taxing on Bitcoin mining is nothing new at all , in fact every cryptocurrency mining can be taxed by the government. So there is nothing to be surprised about here . If the government decides that they would tax it in that country then they will go ahead and do that. And you as a cryptocurrency miner should as well try to comply and pay your taxes from the earnings you make from mining cryptocurrency in the country.

Cryptocurrency mining is a big business this time around and there are so many companies that are into mining cryptocurrency. It is no longer something that an individual can just start up for themselves and be doing it in their house because it requires heavy equipment. Currently, it is big companies that are setting up a mining farm, and it is quite easy for the government to locate where this mining farms are built.

The proposal to lower the bills for miners in the regions that produce more energy than they require seems like a good idea. As for the sell tax, which is proposed on mining, it would mean that taxes could be avoided by paying for things directly in Bitcoin, and also that trading would be basically impossible. However, I see that there's an alternative proposal to tax the income, not the selling. Clearly, Russia is actively figuring out how to best regulate cryptos, but the details have not been resolved yet, and different stakeholders have different opinions.
As for SWIFT that's been touched upon in the thread, unfortunately, a certain culprit (I'm looking at you, Germany) is strongly against it being a part of the sanctions package.

Yeah yeah, the powerful socialist workers of Russia will give it all to build better alternatives and have paved the way to escape the clutches of the European and American capitalists and their evil technologies.

Meanwhile, in the REAL world just a few days ago:
Aeroflot takes delivery of two Boeing 777s with retrofitted cabin

They are building everything on their own, except their planes, their cars, their phones, even their damn tractors as John Deeres has posted record sales for agricultural equipment in Russia. Oh did I mention caviar and vodka? They export 200mllion worth of hard liquor and import 1 billion! Not couting another 300m in beer.

Yeah, live in your fantasy world, don't forget to sell that SWIFT analog to North Korea, wonder why things haven't worked out in that case.

Last time I heard Russia was banning mining, then China banned it, then miners moved to Kazakhstan and had some problems there... Yet' after all this craze Bitcoin's hash rate is at all time high, which you can confirm here: https://www.blockchain.com/charts/hash-rate
Governments aren't stupid, they see there's money to be made here and since all attempts at banning it have failed and it's still growing, maybe the right approach is to simply allow it to flourish and profit from it. Russia with its high inflation could use some new tax payers in the form of big mining companies.

This is the right way - checking in exceptional cases also gives the experience of understanding how it will be later on a countrywide scale. I think that the Republic of Tatarstan will be among the first regions, because it is serious about developing the limits of high technologies - there is even a satellite city of Innopolis. The place where, according to the idea, the Russian "silicon valley" should be formed. How it will be in reality - time will tell, but I think everything will work out in Russia!

Bitcoin mining is a business, and it's taxed as a business, you have expenses, you have revenues, it's so simple to tax it neves ceases to amaze me why people ask these questions.
You're taxed at the value of the coins when you received a payout from a pool or if you're one lucky bastard from when you mine a block, luckily, if you are really bad at trading and you sell those coins one month later at a lower price you can file for a tax deduction as you've lost money.


And if the west doesn't want to deal with Russia?
You realize right now Russia would be just like a shop accepting Visa, Paypal, Monero, and Bitcoin, they can add used panties and discarded diapers as payment options if poeple DON'T want to deal with you they will not! Simple as this!


Benefits? If Russia would be mining all the coins they could get 16 billion a year from it, oil exports are 110 billion and gas 54 billion.
And that would be 100% hashrate, and of course not counting costs.
At December costs for gas, you could either get 1000kwh from burning gas or 275$ from selling it, that is enough to keep a 19pro running for !13 days making you 295$ if you would be able to convert all the energy with losses and you wouldn't have to actually buy that gear and ROI on it.

You live in a great illusion that Bitcoin will be accepted by absolutely all people or countries in the world, and an even bigger illusion is that China or Russia will do it - especially in the political system in power there, and the chances of that changing are minimal or almost non-existent. In terms of value, all mined Bitcoin, even if it is worth x10 more than today, is not enough to interest powerful powers like China or Russia. In addition, in less than 10 years, only 1% (210 000) of BTC will remain for mining, and then who will be interested in mining?


Bitcoin is clearly defined as “A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution." What does that have to do with geopolitics and some visions that don't make any sense?

Right, there is nothing wrong with that. I'm even happy when I see a government that is trying to put things in order by working with cryptocurrency exchanges and companies so that things are in line with the law. It is better this way than seeing governments that are always fighting against cryptocurrency and trying to ban it and stop people from making use of it in their country. What the Russian government is doing is what they are expected and should do.

When there are things like this they are meant to come in and set it up the right way and also make sure that it is not in a way that it would be unfit for those involved in the business, they do their work by trying to create balance which is right.

Another useless piece of news. We in Russia have already heard dozens of such proposals. For example, make the Irkutsk region a region for mining, where the price of electricity is less than 2 cents. If mining is legalized in Russia, then the same situation may happen as in Kazakhstan.

there is a difference between "priced in" and "bottomline value support" increases
price is more subjective to speculative drama of emotion and temporary decisions and media hype of temporary price events.
what goes up can go down (pump and dump, hype and dip, spike and correct)
where as added value to bottomline support is more underneath the market price number. moving up at a progressive long term growth

prices can spike and correct depending on the mood and sentiment of speculators deciding which piece of news is important trade decision factor that day, and its temporary.
however the bottomline value support is based on the basic most efficient mining costs around the world absolutely no one would want to sell below because they cant even mine it any cheaper. so would rather buy coin that cheap and support the price from going below that line.

now take:el salvador
it  has a total combined electric capacity of 2gw.
and has a geothermal power plant that has a capacity of 100mw(0.1GW) that is dedicating 1.5 mw (1500kw) to bitcoin mining
this is allowing for only ~450 asics, (0.075% country cap. 1.5% power plant cap)

so small things like elsalvator going full-on in bitcoin doesnt result in much actual 'value support' of massive hashrate difference (0.049exa)
after all its not even 1% hahsrate affect, nor 0.1%, but more like a 0.026% effect
(at current bottom line value of ~$37k, it translates to about $9.62 value support added. so not even noticeable difference.)
yes the media hype might have caused some price speculation last year when it was first announced. but it didnt even move the needle of a increased value support, to support the temporary price drama media hype, thus the price corrected after the hype

but somewhere like russia which has a capacity of 220GW for all uses..52GW renewable
if russia dedicates 1.5% of all its renewable capacity to bitcoin mining(0.78gw) that would add 27.3exahash to the mining competition. which is a 14% bump at current mining competition
(note: im using a high estimate of dedication of 1.5% of all renewable russian power plants)
(note: there's no announcement of an actual figure for dedicating to mining.. so expect 14% to be optimistic top)
(note: no mining farm set up yet. so expect 14% be alot less by the time things happen)

at the moment with a baseline mining cost (bottomline value support) of ~$37k right now, that can turn into $42k bottom line support
(see notes above for emphasis)
yes it can cause more temporary speculative price drama of volatile spikes and dips. but the effect, if russia was to follow a 1.5% renewable dedication, is only at most, 14%max.. which would be less of a bottomline support % as time moves on

so dont expect a massive "priced in" effect of actual value support, but do expect some media hype causing temporary spike price drama

in short. if news hype does cause a 200% price speculation spike(new ATH). dont expect the actual value support of actual mining cost increases to equally reflect to support the 200%.

thus dont expect russia to "price-in" to any new huge sustained support value

This is confusing, I do not mean what you posted, but what central bank of Russia is doing, this is about mining, how should a central bank be concerned about Bitcoin mining in a country, this is not the work of central bank. What central bank should be concerned about is the monetary aspect of Bitcoin like how they can help people to keep Bitcoin safely in a custodial way and what they can do to make sure Bitcoin is not used for illicit activities in their country.

More countries are pushing for CBDCs but what I have noticed is that CBDCs are just like fiat and have nothing to do with cryptocurrencies, CBDCs devalues and backed by fiat, and have the characteristics that can make people call it fiat. This is just a means many countries may be confusing their citizens to take CBDCs for cryptocurrencies and which is not.

Russia being the fourth largest generator as well as consumer of electricity makes cryptocurrency mining possible. 46% of the electricity production is out of coal. There is not much of alternate source of energy production. Maybe something like solar energy generation could boost the mining, because depending on the climatic situation Russia used to be energy dependent. If it can create alternative, this will help Russia to be self sufficient in energy generation.

Bitcoin mining can turn to be a big industry, because of the cheap electricity and the favourable climatic conditions. Russia focusing on legalizing bitcoin mining also makes other neighbouring countries to take similar decision on bitcoin mining.

I’m not pointing out about “bans, and regulations”. I’m talking about absolute acceptance, publicly or secretly, and an actual nation-state mining Bitcoin for the benefit of themselves, directly or indirectly. Because I believe Bitcoin’s true nature in international politics/geo-politics has not been truly discovered yet, nor has that been priced in.

Latest news I heard today is that no deal was reached between Russian central bank and their ministry, and everything has been postponed until February 18th.
This is some chess game everyone is playing and they are probably testing the grounds how other countries will react to this.
It's much harder for Russia to control mining than it is for China and other countries, but they can certainly impose more taxes and regulations.

Russia never stopped mining Bitcoin so there is nothing to restart, mining is legal there, and I don't believe China will start again officially no matter what Russia or any other country is doing.
I think we are going to see more countries pushing for CBDC centralized coins and China will be followed by EU who is preparing their new digital currency for 2023, according to latest reports I saw yesterday.