In a significant move towards regulation, Russia”s Federal Tax Service (FNS) has reported that more than 5,500 cryptocurrency miners have officially registered since the legalization of mining on November 1, 2024. This development marks a critical step in formalizing an industry that had previously existed in a legal grey area.
The FNS revealed that approximately 1,500 businesses and individual entrepreneurs are now part of the official mining registry, while around 4,000 private individuals are declaring their mined digital assets through the tax authority”s reporting system. Despite these advancements, estimates suggest that nearly two-thirds of crypto mining operations in Russia continue to function without formal registration, thereby escaping regulatory scrutiny.
The newly established legal framework imposes several compliance requirements on registered miners. These participants are mandated to submit monthly production reports detailing the types and quantities of cryptocurrency mined. Additionally, private individuals are exempt from full registration only if their electricity consumption for mining remains below 6,000 kWh per month. There is also a requirement for miners to disclose the number and specifications of their mining equipment, enhancing oversight in this sector.
Under the legislation set to take effect in 2025-2026, cryptocurrency will be classified as property. Corporate miners are subject to a 25% tax on profits, with allowable deductions for operational expenses. In contrast, individual miners face income tax rates ranging from 13% to 15%. Notably, mined digital assets currently enjoy an exemption from value-added tax (VAT).
Looking ahead, Russian authorities have indicated that stricter enforcement measures will commence in 2026. Large-scale illegal mining operations could incur penalties of up to five years in prison. Moreover, mining has been prohibited in 10 to 12 regions to safeguard energy infrastructure, and the FNS has initiated bankruptcy proceedings against industry leader BitRiver due to alleged tax compliance failures. This data underscores Russia”s efforts to regulate crypto mining, with enforcement actions suggesting a strong intention to bridge the compliance gap that still exists.
