As a researcher with extensive experience in the field of cryptocurrency and blockchain technology, I find myself deeply concerned by the recent developments in Russia regarding the proposed restrictions on crypto mining in several key regions. Having closely followed the evolution of this industry, particularly in countries with abundant renewable energy resources like Russia, it’s disheartening to see such measures being considered.
The Russian authorities are thinking about setting limits on cryptocurrency mining in 13 different areas as a response to laws aimed at regulating this sector being passed.
As a researcher, on November 19th, I attended a gathering convened by Russia’s Deputy Prime Minister, Alexander Novak, to delve into the advancements being made in the realm of the electric power sector.
During the gathering, it was suggested that mining operations be restricted in areas experiencing power shortage issues, so as to avoid energy scarcity during periods of high demand throughout the year.
Currently, the government is considering implementing restrictions on cryptocurrency mining in significant mining areas within Russia, such as Irkutsk, and also in territories of Ukraine that are currently under occupation, namely Donetsk, Luhansk, Zaporizhzhia, and Kherson.
Planned restrictions to last until 2031
The proposed crypto mining regulations are set to roll out across various regions in Siberia, such as the Irkutsk region in its entirety, certain districts within the Republic of Buryatia, and the Zabaikalsky Krai.
As per information from the Russian government, these restrictions will likely remain in place through to 2031, particularly during the fall and winter months when heating is required.
Furthermore, the government suggested maintaining comparable restrictive measures up until 2031 in the regions of 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.
Russia’s Irkutsk is one of its key regions for mining crypto
If given the go-ahead, the suggested limitations could significantly impact Russia’s cryptocurrency mining activities, particularly for major players such as BitRiver who heavily leverage affordable electricity resources found in areas like Irkutsk.
Reports say that the Irkutsk region houses the initial and biggest data center by BitRiver, a facility that was established in the city of Bratsk back in 2019.
Crypto miners have found the Siberian areas, particularly cities like Irkutsk, appealing because they offer several advantageous factors. These include an abundance of renewable hydroelectric power, relatively low electricity costs, and a chilly climate.
The Bratsk hydroelectric plant generates up to 4,500 megawatts of electricity, making it one of the major contributors to Russia’s hydropower production.
In August and October 2024, the Russian President, Vladimir Putin, approved a series of bills concerning cryptocurrency mining.
While legislation establishes a basic structure for regulating cryptocurrency mining, there remains ambiguity regarding several facets of regulation that has drawn criticism from various sectors within the industry.
As a researcher delving into the intricacies of cryptocurrency regulations, I’ve observed that Russia’s recent legislative changes have introduced a host of limitations. Among these restrictions are provisions preventing foreign entities from engaging in crypto mining within their borders. Furthermore, these laws grant the government the power to prohibit mining activities in regions susceptible to electricity supply shortages, aiming to safeguard the national power grid.
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2024-11-20 14:58