Russia is moving to ban crypto mining in regions struggling with electricity deficits, a decision announced by Deputy Minister of Energy Yevgeny Grabchak and confirmed by state news agency TASS on October 30. This regulatory action targets specific areas like the Far East, southwestern Siberia, and the South, where energy availability is limited. The aim is to alleviate pressure on the national power grid caused by the high electricity demands of large-scale crypto mining.
Limited Infrastructure and Long-Term Power Shortages
These targeted regions currently lack the necessary infrastructure to support intensive mining operations, and, according to Grabchak, the energy limitations could persist until 2030. The government's strategy includes strict enforcement against unauthorized and home-based crypto mining. Already, law enforcement has arrested individuals engaged in electricity fraud linked to illegal mining; recently, a resident in Novosibirsk was detained for mining activities that allegedly generated over 12 million rubles (about $123,000).
Regulatory Shifts in Russia’s Crypto Landscape
This announcement aligns with recent regulatory developments, notably President Vladimir Putin’s signing of a law on digital asset regulation, effective November 1. This law grants the government authority to ban or restrict mining activities in regions with limited energy resources, outlining procedures for oversight and restrictions. Additionally, the law regulates participation in mining pools, which place extra demand on the energy grid due to the computational power required for operations.
By tightening control over energy-intensive mining activities, Russia seeks to reduce grid stress while maintaining oversight over digital asset mining and transactions.
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