In Russia, questions are being raised about the ban on crypto mining due to energy shortages and rising electricity prices. President Putin highlighted these issues as the main reasons for implementing restrictions.
Reasons for the Mining Ban
During an event focused on discussing development initiatives, Russian President Vladimir Putin explained that electricity shortages caused by the increase in crypto mining have become the main reason for the ban on this activity in certain regions of the country. Local authorities started signaling that there is a lack of energy for infrastructure development and industrial projects, prompting the federal government to take action.
Increase in Electricity Prices
Since July, electricity tariffs in Russia have risen. It is expected that by the end of 2025, the tariffs for transmitting electricity will increase by 11.5%, and the rates charged by local distributors will rise by 11.6%. Energy is one of the largest expenses for crypto mining enterprises.
Future of Crypto Mining in Russia
Despite the legalization of crypto mining in August 2024, current restrictions and high energy costs raise doubts about the competitiveness of the Russian sector. Analysts note that many companies are seeking more favorable jurisdictions for mining, such as the United States. In this context, authorities are considering relocating crypto farms to regions with abundant energy resources.
The situation regarding crypto mining in Russia is complicated by both energy shortages and rising energy prices. This prompts local authorities and mining companies to seek ways to adapt to the new conditions.
