The Russian government has authorized a list of areas and territories where crypto mining will be prohibited starting January 1, 2025.
Crypto-Mining Territories Affected in Russia
According to a local news agency TASS, the restriction will remain effective until March 15, 2031. The affected regions and territories include Dagestan, Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia, North Ossetia, Chechnya, the Donetsk and Lugansk People’s Republics, and in the Zaporizhia and Kherson regions.
The Russian authorities have cited overburdened power grids, increased energy prices for consumers, and unregulated mining operations as primary reasons for the restrictions.
TASS also stated that the marked regions and zones list is not definitive and may be modified following the resolutions of the governmental committee overseeing electric power advancements. The agency said these limitations aim to preserve energy consumption equilibrium while considering industrial requirements.
Commenting on the latest report, Sergey Kolobanov, deputy director of the Center for the Economy of Fuel and Energy Sectors at the Center for Strategic Research, said:
“The terms of restrictions on cryptocurrency mining are synchronized with the end of the transition period for the elimination of this benefit, the expert explains the terms of the ban. After the market liberalization, the restrictions in this part may be lifted, provided, of course, that there is sufficient capacity.”
Russia Plans For More Restrictions
The report further noted that the ban will target mining pools and individual crypto-mining activities. Furthermore, Russia plans to impose partial limitations on mining activities in three Siberian areas during winter months to manage energy demand surges.
The mining ban in Russia represents an updated iteration of the preliminary measures formally introduced by the government in November.
Initially, legislators intended to prohibit cryptocurrency mining in 13 regions, including Irkutsk, a crucial hub for mining operations in Russia.
Meanwhile, leading industry players like BitRiver benefit from the low-cost electricity available in Irkutsk. Local reports indicate that BitRiver’s first and largest data center, established in 2019, is in Bratsk within the Irkutsk region.
Russia Legalizes Crypto-Mining
In November, crypto mining became legalized in Russia, allowing miners to disclose details about their acquired assets and the associated wallet addresses to the Federal Tax Service (FTS).
On November 1, the Federal Tax Service (FTS) introduced a platform for registering miners, which is compulsory for businesses and sole proprietors. Individuals can generate digital currency with a monthly consumption limit of 6,000 kWh.
