YEREVAN (CoinChapter.com) — Russia’s Bitcoin mining industry brought in significant revenue last year, strengthening the country’s economy despite sanctions. According to Sergey Bezdelov, Director of Russia’s Industrial Mining Association, Russia mined around 54,000 BTC, which is worth over $3 billion. In addition, the Bitcoin mining in Russia generated about 50 billion rubles ($556 million) in tax revenue, supporting the country’s financial system.
Bitcoin Mining Legalization Boosts Russian Tax Revenue
In July, Russia’s State Duma passed a bill that legalized Bitcoin mining. This legislation officially recognizes Bitcoin mining in Russia as a legitimate economic activity. Consequently, companies involved in crypto mining must now register and meet specific energy consumption requirements. This move aims to boost the tax revenue from Russian Bitcoin mining and attract more investment.
Notably, Bezdelov stated that the hope is that the legalization of Bitcoin mining will increase investor interest. This could further boost the sector’s role in Russia’s economy. With this law, Russia is actively working to strengthen its crypto industry amid international sanctions.
Russian Crypto Exchanges and Sanction Evasion Concerns
Certainly, while Russia’s Bitcoin mining revenue is on the rise, concerns about sanction evasion also grow. In fact, blockchain analytics firm Chainalysis has flagged Russian crypto exchanges like Garantex as potential tools for Russia to bypass sanctions. Specifically, Garantex, a Russian crypto exchange, has processed nearly $100 billion in transactions since 2018, despite being sanctioned by the U.S. Office of Foreign Assets Control (OFAC) and the U.K.’s Office of Financial Sanctions Implementation (OFSI).
This Bitcoin mining in Russia is seen as a way for the government to boost its economy while avoiding the effects of Western sanctions. Chainalysis warns that Russia could use crypto exchanges to maintain cross-border trade, even under current restrictions.
Exved Exchange and Russia’s Crypto Operations
Moreover, Chainalysis also pointed to the Exved crypto exchange as another platform that Russia could use for sanction evasion. Founded by Sergey Mendeleev and former KGB officer Alexander Lebedev, the exchange has ties to the InDeFi Bank. According to Chainalysis, Exved has facilitated imports and exports, which raises concerns about its role in Russia’s sanctions evasion strategies.
The use of these Russian crypto exchanges could help Russia maintain its economic activities and trade relations. Chainalysis believes that these exchanges will continue to play a central role in the country’s cryptocurrency operations, especially as Russia seeks to use Bitcoin mining and crypto exchanges like Garantex and Exved to bypass Western sanctions.
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