In a recent move, Russia has approved a new bill mandating that miners disclose their income or face imprisonment for failure to comply. This announcement comes as Russia strengthens its grip on the cryptocurrency industry, seeking to make the space more accountable and transparent.
Also, the bill announced the establishment of a Siberian crypto-mining facility which is set to start operation by the middle of this year.
Russian Crypto Miners Face Up To 4 Years In Prison
The Russian government has mandated that cryptocurrency miners reveal their earnings or risk serving up to four years in prison. Alexei Moiseev, Deputy head of the ministry, issued the directive to pertinent departments after a gathering of higher-ranking officials in January.
Along with filing income taxes, miners must also state information concerning transactions, such as wallet addresses. Depending on the income earned, the consequences for failing to report can range from two to four years of jail time and forced labor if found guilty.
Specifically, for a declared income of around $200K not reported twice in three years, the sentence may be up to two years in prison and two years of forced labor. For a declared income of more than $600K not reported, the penalty may be up to four years in jail and four years of forced labor.
The announcement also alludes to a forthcoming regulatory system for cryptocurrencies. Russia supposedly has a list of crypto exchange platforms, and those who do not comply with the regulations could get a prison sentence of up to seven years.
Moreover, changes to anti-money laundering regulations were made, requiring miners to give details about their activities and other specifics of the operation.
Russia Establishes $12 Million Crypto Mining Center in Siberia
Russia has been trying to control the mining sector for quite some time, as evidenced by the statements made in the notification. Despite this, it has also granted some leeway in recent months.
For instance, the government has even given tax benefits to those involved in mining, which has enabled the establishment of a $12 million crypto-mining center in Siberia. This mining site will comprise 30,000 mining rigs and boast a total power of 100 megawatts.
Amid the economic sanctions Russia is enduring, the mining center could bring some respite to the nation’s economy. The country is also launching a state-managed crypto exchange to increase tax revenue.