Russia Could Ban Crypto Mining to Save Electricity
20 Nov, 2024 ● Crypto News
The Russian government is evaluating the implementation of cryptocurrency mining restrictions in 13 regions following the adoption of new laws regulating the industry.
On Nov. 19, Deputy Prime Minister Alexander Novak chaired a government commission meeting focused on the development of the electric power industry.
During the meeting, officials suggested curbing mining activities in areas experiencing power supply issues to mitigate risks of shortages during peak energy demand periods.
The proposed restrictions would apply to major crypto mining regions, including Irkutsk, as well as occupied Ukrainian territories like Donetsk, Luhansk, Zaporizhzhia, and Kherson.
Restrictions are also planned for several Siberian regions, encompassing the entire Irkutsk region, specific areas within the Republic of Buryatia, and the Zabaikalsky Krai.
According to the Russian government, these limitations would be in effect until 2031 during the autumn-winter heating season.
Similar measures are proposed for regions such as the Republic of Dagestan, the Republic of North Ossetia-Alania, the Republic of Ingushetia, the Chechen Republic, the Kabardino-Balkarian Republic, and the Karachay-Cherkess Republic.
Irkutsk is one of Russia’s key hubs for crypto mining.
If approved, the restrictions could significantly impact the nation’s mining sector, particularly firms like BitRiver, which depend on inexpensive electricity in regions like Irkutsk.
Local reports indicate that the Irkutsk region hosts BitRiver's first and largest data center, which was established in 2019 in Bratsk.
Siberian regions such as Irkutsk have historically appealed to crypto miners due to their abundant hydroelectric resources, affordable electricity, and cold climate.
For instance, Bratsk’s hydroelectric power station, with a capacity of 4,500 megawatts, ranks among Russia’s largest hydroelectric power producers.
In August and October 2024, President Vladimir Putin signed several crypto mining laws.
These laws provided the foundation for a regulatory framework but were met with criticism from the industry due to legal uncertainties.
Additionally, the laws introduced several restrictions, including barring foreign entities from mining in Russia and granting the government authority to prohibit mining in regions prone to power shortages.
Sources:
https://cointelegraph.com/news/russia-crypto-mining-ban-13-regions-electricity
