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If approved, the restrictions would seriously affect Russia’s crypto mining operations, as some key local industry firms have a heavy presence in regions like Irkutsk.
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The Russian government is considering imposing cryptocurrency mining restrictions in 13 regions following the adoption of laws targeting the industry.
On Nov. 19, Russia’s Deputy Prime Minister Alexander Novak held a government commission meeting to discuss the development of the electric power industry.
At the meeting, officials proposed limiting mining activities in regions facing power supply challenges to prevent shortages during peak energy demand seasons.
Russia’s Deputy Prime Minister Alexander Novak holds a meeting on the electric power industry. Source: Government.ru
The government currently plans to adopt such restrictions in Russia’s key crypto mining regions like Irkutsk, as well as occupied Ukrainian regions of Donetsk, Luhansk, Zaporizhzhia and Kherson.
Planned restrictions to last until 2031
Russia’s crypto mining restrictions are currently planned to be introduced in several regions in Siberia, including the entire Irkutsk region, individual parts of the Republic of Buryatia and the Zabaikalsky Krai.
According to an official communication by the Russian government, the restrictions are expected to be enforced until 2031 during the autumn-winter heating season.
Additionally, the government proposed similar restrictive measures until 2031 in the territories of the Republic of Dagestan, the Republic of North Ossetia-Alania, the Republic of Ingushetia, the Chechen Republic, the Kabardino-Balkarian Republic, the Karachay-Cherkess Republic.
Russia’s Irkutsk is one of its key regions for mining crypto
The proposed restrictions, if approved, would seriously affect Russia’s crypto mining operations, as some key local industry firms like BitRiver heavily rely on cheap electricity in regions like Irkutsk.
According to local sources, the Irkutsk region is home to the first and the largest data center by BitRiver, which was launched in 2019 in the city of Bratsk.
Bratsk hosts one of the world’s largest hydroelectric power stations. Source: Reuters
Siberian regions like Irkutsk have been attractive to crypto miners due to many favorable conditions such as significant hydroelectric potential of renewable energy, low electricity rates and cold climate.
For example, Bratsk’s hydroelectric power station has an electric power capacity of 4,500 megawatts and is one of Russia’s largest producers of hydroelectricity.
Related: Bitcoin miner outflows surge as price hits new highs
Russian President Vladimir Putin signed a set of crypto mining-related laws in August and October 2024.
Although the laws laid the groundwork for a regulatory framework for crypto mining, many in the industry have criticized legal uncertainty about many aspects of regulation.
In addition to legal uncertainty, Russia’s new crypto mining laws introduced many restrictions, such as prohibiting foreign persons from mining in the country, as well as allowing the government to ban mining in regions vulnerable to power supply shortages.
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This article first appeared at Cointelegraph.com News
