❄ To save energy, Russia launches winter cryptocurrency mining ban in key regions
In order to conserve winter energy, Russia has decided to suspend cryptocurrency mining in some areas. This means that regions such as Irkutsk, Buryatia, and several others may have to temporarily say goodbye to mining this winter.
Reports indicate that the ban will start in December and last until March next year, with some areas in the North Caucasus and Ukraine possibly facing a year-round prohibition.
This year, Russia has become the world's second-largest cryptocurrency mining center, with mining electricity consumption reaching 16 billion kilowatt-hours annually, accounting for 1.5% of the country's total energy consumption. This poses a significant challenge for regions with tight electricity supplies.
About a month ago, Russia introduced a new legal framework requiring individuals and companies engaged in mining to register with the tax office. Those whose monthly mining electricity consumption exceeds 6,000 kilowatt-hours must register as individual entrepreneurs. The government also plans to share mining data electronically with the central bank, electricity companies, and others.
Meanwhile, last week, the Russian government revised its cryptocurrency tax policy, defining cryptocurrency as property for taxation purposes. Mining income is taxed based on market value, but miners can deduct certain expenses. Transactions involving cryptocurrencies are exempt from value-added tax.
Although trading cryptocurrencies is illegal in Russia, the adoption rate among Russians has increased due to war and sanctions. At the same time, cryptocurrency services in Russia are very popular, attracting significant domestic and foreign investment.
This includes a surge in large-scale institutional transfers, as well as increased activity from Russian exchanges that do not require KYC, successfully achieving significant growth in DeFi and balanced growth in traffic for centralized exchanges.
Conclusion:
Russia's winter ban on cryptocurrency mining alleviates electricity shortages and demonstrates an emphasis on energy efficiency and policy adaptability. At the same time, it strengthens taxation and regulation of cryptocurrencies, which may have significant implications for global markets in terms of legality and regulation.
What are your thoughts on Russia's winter mining ban? In the context of energy shortages and environmental protection, how do you think the mining ban will impact the local cryptocurrency market?
