Belarus to Remain Crypto-Friendly as Ally Russia Mulls Blanket Ban

Authorities in Belarus have no intentions to adopt stricter rules for the country’s crypto space. That’s despite neighboring Russia, a close partner in many areas, considering a blanket ban on а number of activities related to cryptocurrencies as suggested by the central bank in Moscow.

Belarus to Keep Favorable Crypto Regulations

Officials in Belarus do not plan to tighten the country’s regulatory framework for the crypto sector, a statement has indicated. This comes as Russia, which is a close economic ally, is mulling over a proposal to impose harsh restrictions on a range of crypto-related operations, including mining, trading, and investing.

“Restrictive changes to the existing regulatory model are not currently foreseen,” the Belarus Hi-Tech Park (HTP) said in correspondence with BNN Bloomberg. The HTP, often called “Belarusian Silicon Valley”, manages a special legal regime established to facilitate the development of the country’s IT industry, including crypto business.

Minsk legalized crypto activities such as mining and exchange with a decree signed by President Alexander Lukashenko which went into force in March 2018. It introduced tax breaks and other incentives for companies working with digital assets.

In April 2019, the Belarusian leader suggested that bitcoin farms could be built at the nuclear power plant in Grodno and in August last year he urged Belarusians to stay in their home country and start mining cryptocurrencies. That’s despite hinting at possible tightening of regulations in March.

Using cryptocurrency for payments is prohibited in Belarus but entities registered as residents of the Hi-Tech Park can issue and trade coins and tokens. In November 2020, the country’s largest banking institution, Belarusbank, launched a service allowing users to buy and sell digital currencies.

The cryptocurrency adoption index by blockchain forensics firm Chainalysis ranks Belarus third in Eastern Europe, after Russia and Ukraine, largely due to strong peer-to-peer activity in the country. Belarusians are not obliged to report their crypto transactions to tax authorities.

Belarus maintains close economic, political, and military ties with the Russian Federation, the central bank of which proposed last week to prohibit the use, issuance, and exchange of cryptocurrencies. However, the regulator’s hardline stance has been rejected by representatives of other government institutions.