Despite the lack of direct regulation of mining in Russia, more than half of the mining enterprises in the country operate legally. These statistics were revealed in the OXLY service.

According to OXLY estimates, more than 50% of Russian miners sell computing power for export, which is fully consistent with current Russian legislation.

“Russian miners, with all their desire to work in a completely legal field, are faced with the problem of receiving income to their bank account. They can be registered as a legal entity, use officially imported and customs-cleared equipment, have contracts with an energy sales and hosting company, but a miner in Russia cannot officially sell Bitcoin for a bank transfer and receive proceeds to his current account. Exporting hashrate solves this problem, because in this case the miner is not selling cryptocurrency, but his computing power,” said OXLY service development director Danatar Atajanov on the sidelines of the Crypto Summit 2024 conference in Moscow.

According to him, large mining enterprises are established by foreign legal entities that act as buyers of hashrate from Russian companies. A foreign company sells the mined coins and sends part of the proceeds as payment for computing power to the settlement account of a mining enterprise in Russia.

Medium and small miners do not have the resources to create their own infrastructure that will be able to accept hashrate in other jurisdictions, convert it into cryptocurrency and pay in rubles to a bank account in Russia. They use marketplaces like OXLY, which buy and sell hashing power for mining.

“A miner from Russia connects to the OXLY service and enters into an agreement with our German legal entity, which buys computing power. Computations from Russian data centers are supplied to Germany. The service sells mined coins on a crypto exchange in accordance with German legislation, which allows such activities. Then the marketplace, minus its commission, sends the money to Russia, and the miner receives payment for the calculations in rubles to his current account. This gives the miner the opportunity to conduct a completely legal business in Russia: receive income into a current account, pay operating expenses from it, and pay taxes on income,” Atadzhanov explained.

This allows the miner to work like an ordinary entrepreneur who sells calculations and for this receives a reward in rubles to his current account.

Russia is one of the largest regions in the world in terms of mining capacity. According to estimates by the Russian Ministry of Finance, cryptocurrencies are mined in Russia “about $4 billion, and the profit of miners is approximately 100 billion rubles,” as Ivan Chebeskov, director of the financial policy department of the Ministry of Finance, said last year.

A bill to regulate cryptocurrency mining in Russia was submitted to the State Duma in November 2022, but it has not yet been adopted. The bill obliges individuals and legal entities to report to the tax service on mined cryptocurrencies, indicating the deposit address. In February 2024, the head of the banking regulation department of the financial policy department of the Ministry of Finance, Osman Kabaloev, reported that the law on mining, allowing to use cryptocurrencies mined in Russia for settlements in international trade may be adopted in the current parliamentary session.

OXLY is a distributed computing marketplace that connects sellers and buyers of computing power. Service oxly.io offers its users to sell computing power for mining for fiat money, bypassing transactions with cryptocurrencies, so that the income from mining is stable and legal, and thereby makes it possible to receive legal income.

The fourth annual Crypto Summit, which takes place in Moscow from March 20 to 22, will be attended by more than 7,000 people. The main goal of the event is to unite experts and industry participants and jointly develop a common plan for the development of the industry in the coming years.