Russia is increasingly adopting more detailed regulations in the field of cryptocurrencies. In August, President Vladimir Putin legalized cryptocurrency mining. Since then, the country has introduced new regulations to align mining activities with national energy demands.
Recent additional rules include both complete bans and seasonal restrictions, expected to come into effect from the beginning of next year.
The Russian Government Approves the List of Regions Prohibiting Cryptocurrency Mining Activities
According to TASS, Russia's leading state news agency, it reports that Russia intends to ban cryptocurrency mining for six years from January 1, 2025, to March 15, 2031, in 10 regions. These regions include Dagestan, Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia, North Ossetia, Chechnya, Donetsk, Lugansk, Zaporizhzhia, and Kherson.
In some places like Irkutsk, Buryatia, and the Trans-Baikal Region, Russia will restrict mining activities instead of enforcing a complete ban. These areas will suspend mining operations from January 1 to March 15, 2025, and from November 15 to March 15 in the following years.
TASS emphasizes that the government does not consider the list of prohibited and restricted areas to be fixed and can be adjusted by decisions from the legal committee managing the development of the energy sector. The government aims to maintain a balanced energy consumption level through these new regulations.
"This is the so-called inter-regional symmetry, where low electricity costs in regions with regulated contracts are effectively offset by producers and consumers in other regions. After liberalizing the market in this area, these restrictions could be lifted, as long as there is sufficient capacity," said Sergei Kolobanov, Deputy Director of the Complex Fuel and Energy Economy Center at CSR, to TASS.
According to data from the University of Cambridge, Bitcoin mining in Russia accounts for 4.7% of the global hashrate, down from 11% in August 2021. Meanwhile, miners in the United States account for the largest share at 37.8% of the global hashrate.
Global Hashrate Rate (Monthly Average). Source: CCAF
Cambridge data also shows that the average monthly hashrate of Russian miners has decreased from 13.6 Eh/s to 8.7 Eh/s. Although Russia has legalized mining, this development has not stimulated significant growth in mining activities in the country.
However, in 2024, the Russian government has shown a more open stance towards cryptocurrencies, including allowing cross-border cryptocurrency payments and preparing to launch state-backed cryptocurrency exchanges. Additionally, Russian lawmakers have proposed to hold reservesBitcointo enhance financial stability.
