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Hungary’s central bank chief wants EU-wide crypto trading and mining ban

Hungary’s central bank chief wants EU-wide crypto trading and mining ban

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György Matolcsy, Governor of the Hungarian National Bank, has proposed a blanket ban on all cryptocurrency trading and mining operations across the European Union. 

Governor Matolcsy cited the recent crypto ban imposed by China in a blog post shared by the Hungarian central bank a.k.a. Magyar Nemzeti Bank (MNB) titled “Time has come to ban crypto trading and mining in the EU.”

He also pointed out the Russian central bank’s proposal that calls for a blanket ban on domestic cryptocurrency trading and mining. Reciprocating the proposals for a crypto ban, Matolcsy said:

“I perfectly agree with the proposal and also support the senior EU financial regulator’s point that the EU should ban the mining method used to produce most new bitcoin.”
The governor strongly believes in cryptocurrency’s potential to “service illegal activities and tend to build up financial pyramids.” Matolcsy also highlighted concerns raised by the Russian central bank — that the market value in crypto is determined by the “speculative demand for future growth, which creates bubbles.”

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On an end note, governor Matolcsy calls for an outright blanket ban on cryptocurrencies to counter the investor’s risks related to financial pyramids and bubbles:

“EU citizens and companies would be allowed to own cryptocurrencies abroad and regulators will track their holdings.”

On Sept 2021, a bronze statue of legendary Bitcoin (BTC) creator Satoshi Nakamoto was unveiled in Graphisoft Park in Budapest, Hungary.

Satoshi statue unveiled today in Budapest. Love how it is reflective, underlining how we all play a role in Bitcoin.

May it inspire all those fighting against authoritarianism worldwide, including dissidents and journalists being persecuted by Viktor Orbán in Hungary. pic.twitter.com/kEOaDt4ahi

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— Alex Gladstein ⚡ (@gladstein) September 16, 2021
As Cointelegraph reported at the time, the sculpture shows the upper half of a figure with a featureless face wearing a hoodie with the BTC logo. Debreczeni Barnabás, the CEO of Hungarian crypto exchange Shinrai was among the numerous crypto entrepreneurs who spoke at the ceremony:

“Satoshi Nakamoto has created an independent money free of any middlemen that empowered people with financial sovereignty […] We have erected this statue to remind ourselves courage is virtue. We need to keep on dreaming big.”

Bitriver

Russia Expands Its Crypto Mining Capacity, Report Reveals

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Russia Expands Its Crypto Mining Capacity, Report Reveals

The total capacity of crypto mining facilities in Russia has been increasing in the past year, despite the market downturn and sanctions, according to a survey of leading operators. Depressed prices of mining equipment and stronger interest from domestic customers have been identified as major factors for the trend.

Miners Prepare for Growth as Total Capacity of Crypto Farms in Russia Reaches 500 MW

The capacity of Russian mining farms has exceeded 500 megawatts (MW) at the end 2022, according to results from a poll among established industry players published by the business daily Kommersant. The beginning of 2023 sets them up for continued growth, on the backdrop of a crypto market recovery, but the expansion could potentially be limited by electricity tariffs and taxes for miners, executives said.

Bitriver, the leader in the group, has eight crypto mining sites with a combined rating of 300 MW. The power of the facilities run by Ural Mining Company (UMC) is 88 MW. Bitcluster owns three 60-megawatt farms, EMCD operates 50 MW of data centers in four different locations while BWCUG has one at 20 MW.

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With abundant energy resources and cool climate, the Russian Federation has certain advantages as a mining destination. However, the ongoing clash with the West over the war in Ukraine has affected the industry, with sanctions hitting Russia’s mining potential in order to limit its ability to use cryptocurrencies to circumvent financial restrictions.

But the penalties and the state of the crypto economy have had different effects on the business of the Russian mining companies. Bitriver, which was specifically targeted by U.S. sanctions, has actually doubled the number of its data centers and available capacity, realizing several large-scale projects in Russian regions, its founder Igor Runets told Kommersant.

Meanwhile, BWCUG has reduced its mining capacity. The company explained new European and North American clients are reluctant to use Russian facilities, despite the lower costs. The operator also highlighted the unclear prospects for crypto mining in terms of legislation. A bill designed to regulate mining in Russia was submitted to parliament in November but is yet to be adopted.

Alisa Tsukanova, marketing director at EMCD, remarked that the profitability of mining business may decrease if the government introduces special electricity tariffs and taxes for coin minting enterprises. Speaking to the daily Izvestia, the Chairman of the State Duma Committee on the Financial Market Anatoly Aksakov talked about two options — either imposing a levy like the single tax on imputed income, with a rate in the range of 7.5 – 15%, or taxing profits at 20%.

The survey has been conducted after a study revealed in October last year that bitcoin mining revenue in Russia grew 18 times in four years before declining steeply in the second quarter of 2022. Another piece of research published in August established that the electricity consumption of Russian miners had increased 20 times since 2017.

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Bitriver, capacity, Crypto, crypto farms, crypto market, crypto miners, crypto mining, Cryptocurrencies, Cryptocurrency, Miners, mining, mining companies, mining farms, Mining Industry, mining operators, mining sector, recovery, Russia, russian, Sanctions

Do you think Russia’s crypto mining industry will continue to grow despite the challenges? Share your expectations in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons, hlopex / Shutterstock.com

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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amendments

Kazakhstan Launches Consultation On Proposals To Improve Crypto Trading

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Kazakhstan Launches Consultation On Proposals To Improve Crypto Trading

Financial authorities in Kazakhstan are starting a public consultation on draft changes to the country’s framework for digital-asset trading. The proposals include measures to reduce risks in the crypto market and improvements to the structure of exchange platforms.

Kazakhstan’s Financial Hub Seeks to Amend Its Concept for Trading Digital Assets

The Astana Financial Services Authority, the body that oversees the Astana International Financial Center (AIFC), has published a consultation paper detailing proposals aimed at upgrading Kazakhstan’s regulated ecosystem for cryptocurrency operations.

The document suggests measures to reduce market risks in the government-controlled trading environment. The regulatory body has also prepared solutions to improve the current structure of the crypto platforms working out of the Central Asian nation’s financial hub.

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Residents of the AIFC, as well as other interested parties, have been invited to participate in the consultation, the crypto news outlet Forklog reported, quoting the announcement. The managing authority will accept public feedback until Feb. 25.

The approved proposals will be added to the draft amendments to the AIFC Digital Assets Trading Concept expected to be released later this year. Among them are mechanisms to prevent market abuse, limit settlement risks and disclose information to investors.

The initiative comes after the parliament in Nur-Sultan adopted a bill devoted to regulating the country’s crypto space. Along with other legal acts, the law “On Digital Assets in the Republic of Kazakhstan” introduces rules for the mining and circulation of cryptocurrencies.

The legislation also envisages the establishment of a licensing regime for crypto miners and exchanges to replace the existing registration system. Kazakhstan became a mining hotspot following China’s crackdown on the industry and has been looking to regulate the sector and the sale of minted coins.

The influx of miners was blamed for the country’s growing power deficit and authorities have been cracking down on unauthorized crypto farms. They have also taken down a number of illegal crypto trading platforms as only exchanges registered at the AIFC are allowed to provide such services.

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amendments, consultation, Crypto, crypto assets, crypto miners, crypto mining, Cryptocurrencies, Cryptocurrency, Digital Assets, Exchange, Exchanges, Kazakhstan, Law, Laws, licensing, Miners, mining, paper, Proposals, registration, Regulation, Regulations, trading

Do you think Kazakhstan takes steps to expand its legal framework for digital assets in order to become a regional crypto hub? Tell us in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

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Ban On Crypto Mining In Residential Areas Proposed In Russia

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Ban On Crypto Mining In Residential Areas Proposed In Russia

Advisors to the Kremlin have suggested that home crypto mining should be banned in Russia, or in some of its regions. The stated motive for the proposal is to prevent fires in residential buildings. Amateur miners have been blamed for high loads on the grid causing breakdowns and blackouts.

Energy Experts Want to Prohibit Mining Cryptocurrency in Russian Homes

The Energy Committee of the State Council, an advisory body to the Russian president, has recommended imposing a ban on the minting of digital currencies in residential areas. Its members believe the measure will reduce fire hazards, local media reported.

The idea is to completely prohibit the production of cryptocurrencies in apartment blocks and houses in the country, or at least in parts of Russia experiencing energy deficits. Among them are Moscow and the Moscow Oblast, the region adjacent to the Russian capital.

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The crypto-related activity, which is a source of additional income for many ordinary Russians, especially in places with access to cheap electricity, is not regulated yet. A bill tailored to do that is currently under review in the State Duma, the lower house of Russian parliament.

The energy experts also suggested that the federal government should grant regional authorities powers to impose additional taxes on cryptocurrency mining, the daily Izvestia revealed in a report, quoting the minutes from a meeting of the committee held in mid-December.

Anton Tkachev, member of the State Duma Committee on Information Policy, Information Technologies and Communications, believes the push to ban mining in residential areas and energy-deficient regions is a logical move as industrial mining farms already consume critical amounts of energy.

He also emphasized that energy security is an acute issue, especially for small towns with insufficient budgets to fund the proper repair and maintenance of energy systems and facilities. As for private homes, there is also the risk of the mining equipment causing fires, the lawmaker added.

The Russian Ministry of Energy, which supports the legislative regulation of crypto mining, noted that distribution networks in residential areas are not designed to handle the overloads due to coin minting in households, as pointed out by Russian energy companies.

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Irkutsk Oblast has become Russia’s hotspot for home mining as residents take advantage of some of the lowest electricity rates in the country, subsidized for the population, and set up crypto farms in basements and garages. According to media reports, mining hardware has been found at the places of 23 fires in the region during the first half of 2022 alone.

Tags in this story

amateur miners, ban, breakdowns, consumption, Crypto, crypto farms, crypto mining, Cryptocurrencies, Cryptocurrency, Electricity, fires, grid, home mining, Load, mining, mining installations, proposal, Regulation, Russia, russian

Do you think Russian authorities will ban cryptocurrency mining in residential areas? Share your expectations in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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