Russian authorities announced plans to impose crypto mining bans in several regions this winter to address electricity shortages.
Mining Bans in Various Regions
The restrictions will affect the Irkutsk region, parts of the Republic of Buryatia, the Zabaikalsky region, and six regions in the North Caucasus, including Chechnya and Dagestan. The crypto mining bans will also extend to the occupied Ukrainian regions of Donetsk, Luhansk, Zaporizhzhia, and Kherson.
Reasons for the Restrictions
A government commission led by Deputy Prime Minister Alexander Novak introduced the measures to curtail crypto mining during the heating season. Mining activities in Siberia will be suspended from December 1, 2024, to March 15, 2025, with annual restrictions from November 15 to March 15 through 2031. In the North Caucasus and occupied Ukrainian territories, the ban will be total from December 2024 to March 2031, without seasonal exemptions.
Economic Impacts and New Laws
These measures follow new crypto mining laws signed by President Vladimir Putin on November 1, which regulate mining activities and establish experimental infrastructure for cross-border cryptocurrency payments. While domestic crypto payments remain prohibited, some lawmakers see these regulations as a tool to potentially circumvent international sanctions. Russia, the world’s second-largest hub for cryptocurrency mining after the United States, consumes approximately 16 billion kilowatt-hours annually for mining, representing 1.5% of its total electricity use.
The new measures and laws aim to address winter energy shortages and regulate crypto mining amidst political and economic instability.
