Pakistan appoints crypto advisor to PM & allocates 2K MW to Bitcoin mining

A number of reports published by local Russian media in recent days suggest that the Russian authorities are implementing taxation and regional controls on cryptocurrency mining.Photo by Michael Parulava on UnsplashRegional mining banA report published by the Moscow Times on Nov. 19 suggests that Russia’s Deputy Prime Minister, Alexander Novak, has led a government commission that plans to implement a ban on cryptocurrency mining in specific Russian regions.  The authorities have been motivated in enacting such a ban in order to combat power shortages. With that, a ban is being implemented on a temporary basis during the heating season. The restrictions will apply to miners located within six regions within the North Caucasus, as well as the Zabaikalsky region in Siberia and territories now controlled by Russia in Ukraine. The ban will apply from December through to mid-March 2025, with this seasonal restriction to be applied subsequently each winter until 2031. Back in August, Russian President Vladimir Putin signed into law legislation which legitimized cryptocurrency mining within the Russian Federation. That law recognized mining activities and the concepts of mining pools and mining infrastructure operators. The legislation requires mining operators to register with the government. Individual miners can mine without registering so long as they stay within specified energy-use limits. Earlier this month, the authorities set a power consumption limit of 6,000 kWh per month for those unregistered miners.  The legislation also recognized the ability of stakeholders to trade in foreign digital assets on Russian blockchain platforms, with Russia’s central bank, the Bank of Russia, retaining the ability to ban specific digital assets from being traded if such trading is deemed to be a threat to Russia’s financial stability. 15% tax proposalEarlier this week Russia’s Interfax news agency reported that the Russian government had approved draft amendments to a bill concerned with the purchase and sale of digital currencies relative to crypto mining activity.  According to those proposed legislative amendments, digital assets will be classified as property from a taxation perspective. Income derived from mining activities will be assessed in terms of taxation based on market value at the time of receipt of the asset. The legislative amendments propose a 15% tax rate for cryptocurrencies. Furthermore, crypto transactions will not be subjected to value-added tax (VAT). However, income derived from such transactions will be taxable in the same way as income from transactions involving securities. Crypto mining operators will be permitted to deduct operating expenses from their taxable income. Russia’s Finance Ministry is understood to have clarified that the taxation approach would strike a balance between Russian government interests and those of commercial operators. With the introduction of legislation to recognize cryptocurrency mining activity earlier this year, Ki Young Ju, CEO of on-chain and market data analytics firm CryptoQuant, noted the country’s growing involvement and national-level engagement with digital assets. The coming months will determine if these latest crypto mining restrictions will dampen the level of involvement of Russia-based crypto miners.

Circle President Heath Tarbert, who oversees the issuer of the USDC stablecoin, arrived in Seoul on Aug. 21 for a series of meetings with South Korean cryptocurrency and blockchain industry leaders, as well as the governor of the country’s central bank. Citing industry sources, local outlet Newsis reported Tarbert visited three major exchanges, Upbit, Bithumb and Coinone, shortly after landing, spending roughly an hour at each. Discussions centered on recent developments in Korea’s digital asset ecosystem.Photo by Daniel Bernard on UnsplashGathering insight from exchangesThe trip underscores Circle’s growing interest in South Korea, one of the world’s largest crypto markets by trading volume despite its heavy tilt toward retail investors. Circle is reportedly seeking on-the-ground insight from local trading platforms. An executive from a research firm said the market offers an attractive foothold for global players looking to deepen networks. Previous reports indicated Circle has also begun informally recruiting in South Korea to support initiatives tailored to the local market, and the company is also weighing a direct investment in a domestic crypto firm. Homing in on stablecoinsStablecoins are expected to dominate the agenda with exchanges. USDC is the world’s second-largest stablecoin by market share, behind Tether’s USDT, and all three exchanges already support USDC trading. Upbit and Bithumb have meanwhile indicated their plans to develop Korean won–pegged tokens, recently filing trademark applications for their projects. Given Circle’s position in the sector, one exchange official said local platforms may look to the U.S.-based company as a benchmark, adding that practical knowledge-sharing could be the most meaningful outcome of Tarbert’s visit. Tarbert also attended a dinner with Simon Seojoon Kim, CEO of crypto venture firm Hashed, whose teams span Seoul, Singapore, Bengaluru, Silicon Valley and Abu Dhabi. Circle and Hashed have been in frequent contact, and the gathering offered another forum to exchange views on recent market developments. Talks with the central bank governorOn the policy front, Tarbert met with Bank of Korea (BOK) Governor Rhee Chang-yong at Circle’s request before the dinner. Rhee has signaled openness to the introduction of won-backed stablecoins, while emphasizing prudential safeguards and noting differences with some lawmakers on potential issuers. The BOK head has previously warned that allowing non-bank entities to issue won-backed stablecoins could pose risks, such as circumventing capital rules. The South Korean central bank is working with other agencies to develop a framework that ensures the stability and utility of stablecoins while preventing their use to bypass foreign exchange controls. The meeting between Tarbert and Governor Rhee likely covered regulatory parameters for cross-border remittances using stablecoins and avenues for public-private collaboration to foster a compliant won-stablecoin market. On the following day, Tarbert is slated to meet executives from four major financial groups: Shinhan Financial Group, Hana Financial Group, KB Financial Group and Woori Bank. Kakao Group, the company behind the KakaoTalk messaging app, is also on the itinerary. Representatives from its mobile payment platform, KakaoPay, are expected to take part in the discussions. The talks come as Kakao recently formed a task force to navigate Korea’s evolving stablecoin rules. Separately, Circle listed on the New York Stock Exchange (NYSE) earlier this year under the ticker “CRCL.” The initial public offering (IPO) priced at $31 a share and opened at $69, raising nearly $1.1 billion. As of Aug. 21, the stock closed at $131.80. 

Japan’s financial sector is poised for a significant change as the Financial Services Agency (FSA) unveils new tax reform guidelines for fiscal year 2025. This marks the first time virtual currency transactions will be addressed within Japan's tax framework, signaling a pivotal shift in the country’s stance on cryptocurrency taxation. Current taxation issuesPresently, Japan imposes a maximum tax rate of up to 55% on cryptocurrency revenues, a figure that has been criticized for deterring investment in the growing crypto market. Crypto profits are taxed as miscellaneous income, with the highest rate applying to earnings over 200,000 Japanese yen. Corporate holders of crypto assets face a flat 30% tax on their holdings, irrespective of their income or profits. These high tax rates contribute to Japan's relatively low cryptocurrency adoption rate, placing the country 18th in the 2023 Global Crypto Adoption Index by Chainalysis.Photo by Tobias Wilden on UnsplashIn response to rising demands from both investors and businesses, there is strong advocacy for a more favorable tax structure. The new proposal suggests reducing the crypto tax rate to 20%, aligning it more closely with the tax rates applied to traditional financial assets like stocks. This reform is viewed as essential for rejuvenating the industry, especially given Japan’s increasing engagement with cryptocurrencies. Japan's interest in cryptocurrencies extends beyond individual investors. Major institutions are making notable advancements in the field. Ripple, a key player in the crypto space, has teamed up with over 50 Japanese financial institutions to develop a new payment infrastructure leveraging blockchain technology. Meanwhile, private companies like Metaplanet are also expanding their crypto investments, recently securing a loan of 1 billion Japanese yen ($6.8 million) at an annual percentage rate of 0.1%.  Impending tax changesThe FSA's decision to include crypto assets in the 2025 tax reform proposal represents a significant departure from previous reluctance to formally recognize the industry. The proposed changes would expand loss offset provisions, potentially aligning crypto assets with the tax treatment of public bonds and listed stocks. This adjustment could offer relief to investors by allowing them to offset losses against their crypto gains. Despite these promising developments, the implementation of these proposals remains uncertain. A previous proposal to reduce the crypto tax burden has failed to produce policy changes. Nevertheless, the inclusion of crypto assets in the FSA’s reform agenda is a positive step toward a more supportive regulatory environment. Japan’s current high tax rates contrast sharply with other crypto-friendly regions in Asia. For instance, the United Arab Emirates (UAE) has become a major hub for crypto businesses by imposing no taxes on crypto profits. Similarly, countries like Hong Kong, Singapore, Thailand and Indonesia have attracted significant crypto activity due to their progressive regulations and lower tax rates. Conversely, India’s 30% flat tax on crypto has prompted many companies to relocate to more favorable jurisdictions such as Dubai. As Japan considers transitioning to a more crypto-friendly tax regime, there is cautious optimism about its potential impact on the industry. If successfully implemented, the proposed changes could boost adoption and growth, making Japan a more appealing location for crypto businesses and investors. The ultimate effect will depend on the government’s reception and execution of these proposals in the coming years. For now, the inclusion of crypto assets in the tax reform agenda marks a promising step toward a more balanced and supportive regulatory landscape for the cryptocurrency industry in Japan.