Bank of Russia rejects launch of the RAKIB mining pool.

The Bank of Russia has deemed the launch of the “National Mining Pool,” developed by the Association of Developers and Users of Blockchain Technology (RAKIB), impractical. This is reported by RBC citing association representatives.

The project envisaged a collective cryptocurrency mining to use electricity more efficiently. But the Bank of Russia deemed it impractical due to high risks of money laundering and the service’s incongruity with state policy in cryptocurrency regulation.

In a letter to the head of the Central Bank Elvira Nabiullina, RAKIB president Yuri Pripachkin described the regulator’s refusal as “unmotivated.” He noted that during the pilot launch in the ‘sandbox’, the advantages and risks of the measure were thoroughly examined.

“The project does not provide a technical means for participation by individuals who are not identified within it, nor the possibility of an ‘external’ cryptocurrency not obtained within the project appearing therein. Transactions with cryptocurrency based on the NMP service do not contain suspicious indicators and can be conducted within the existing legal framework of the Russian Federation,” he stated in the letter.

If the NMP project were approved, miners could legally sell mined cryptocurrency in Russia and pay taxes. At present, withdrawals are possible only through foreign services or illegal exchanges.

RAKIB estimates that the economic impact of implementing the NMP would exceed $2 billion in the first year. The NMP could operate without Bank of Russia approval, but banks fear losing their licenses as a result.

The association has asked the Bank of Russia for clarifications on which provisions of the project conflict with the government’s policy in the digital economy.

As noted, the NMP project was first presented in March 2018. The pilot in the Bank of Russia’s regulatory sandbox was launched in November 2019.

In February 2018, representatives of the Russian financial regulator said that cryptocurrency mining should be conducted in accordance with the law.

The law “On Digital Financial Assets,” approved at the end of July, provides definitions of “digital financial assets” and “digital currencies” and prohibits using the latter as a means of payment. It also includes references to yet-to-be-adopted subordinate acts regulating mining, the issuance and circulation of digital currencies.

Subscribe to the ForkLog channel on YouTube.