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Russia – second largest mining hotspot after the USA

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Russia rises to number 2 in global crypto mining. At least that’s what one claims report of the Russian daily newspaper “Kommersant”, referring to data of the hosting service BitRiver. Accordingly, activities in the country between January and March 2023 increased to one gigawatt of electricity consumption. The USA continues to take first place with an output of between three and four gigawatts. However, it is unclear on what basis the data was collected.

Still, the dominance of the United States could crumble, BitRiver CEO Igor Runets told Kommersant. In fact, crypto miners are currently in a difficult position in the USA. Due to the negative market situation in combination with rising energy costs, several leading companies such as Compute North and Core Scientific have filed for bankruptcy in recent months. In addition, a planned tax increase by US President Joe Biden is an additional burden on crypto miners.

Mining paradise Russia?

Russia has been pursuing a friendlier crypto course since the beginning of the Ukraine war, also to avoid western sanctions. The country is working on its own CBDC, which is to be rolled out in the coming year. The Kremlin reformed the taxation of cryptocurrencies. He is planning his own exchange for digital assets.

With regard to mining, the State Duma has had a draft law since April last year that is intended to make it possible for companies to have a simplified registration process with the authorities. According to Kommersant, the discussions are not yet very advanced. Russian news agency Interfax reported in November last year that the Kremlin wants to make it easier for crypto miners to convert crypto to fiat money. Officially to “promote innovation”, but unofficially the goal of circumventing sanctions is likely to play a role.

Russia wants to use this to attract more mining companies to the country. The low energy prices and the climatic conditions speak for the location. However, it remains questionable whether US prospectors in particular want to set up camp in Russia and thus accept sanctions.

 

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.
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