According to recent reports, Russian President Vladimir Putin legalized Bitcoin and digital asset mining by signing new laws last Monday. Those laws establish a national register defining who is entitled to mine Bitcoin in Russia.
A new law by Putin exempts people from using low-energy mining eqauipment. As a result, citizens operating below the government's electricity cap are now permitted to mine Bitcoin legally. It thus also legitimises crucial components of the network, including mining pools and address identifiers, thereby authorising trading in foreign virtual currencies on Russian blockchains.
Despite such legalization, the Bank of Russia retains the right to prohibit those assets if they represent a danger to financial stability in the country.
Putin signed these crypto laws last month after two frameworks were rubber-stamped by the State Duma, Russia's lower house of parliament. The law legalizing crypto mining in Russia will be effective November 1 this year.
Reports indicate that Putin signed this bill on Thursday, August 8, amid a broader shift in Russia's approach to digital assets. Another law letting Russia's central bank consider cross-border cryptocurrency settlements will take effect on September 1. Reports have it that El Salvador is now searching for Russia's help amid possible crypto trade ties.
Russia's move to legalize Bitcoin mining is part of a global trend towards the adoption of Bitcoin. More and more countries around the world are realizing the potential of decentralized digital currencies and blockchains.
In the nation of El Salvador, under President Nayib Bukele, policies are enacted that promote innovation in Bitcoin, continue to stockpile reserves of cryptocurrency, adopt Bitcoin as legal tender, and encourage mining.
The United States is also close to witnessing major changes regarding how Bitcoin and cryptocurrencies are treated, but the extent might depend on the result of the November election.
Big institutions like BlackRock and Fidelity have launched regulated Bitcoin funds. The same case applies to Ethereum exchange-traded funds, which have been allowed to start operations by the US Securities and Exchange Commission.
According to proponents, a strategic Bitcoin reserve—along the lines of what former President Donald Trump and Senator Cynthia Lummis of Wyoming have proposed—will accelerate Bitcoin adoption at an even faster rate.
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