According to a new government estimate, the share of crypto miners in Russia’s electricity consumption structure has exceeded 2%. Against this backdrop, the country’s Ministry of Industry believes that it is time for the industry to step out of the shadows and regulate it.
Crypto miners consume more electricity than Russian farmers
Vasily Shpak, Russia’s Deputy Minister of Industry and Trade, said that miners extracting digital currencies account for more than 2 percent of the Russian Federation’s total electricity consumption, and their activities need to be “whitewashed” and regulated. Speaking at a forum organized by the ruling United Russia party, Shpak elaborated:
This exceeds the cost of agricultural electricity. In this sense, we have to admit that mining is an industry.
At an event dedicated to the development of blockchain technology and regulation of digital financial assets, the government official noted that cryptocurrency mining is now in a “grey area,” which is not taxed in any way and poses risks to those involved in it . Shpak believes that the industry can come out of the shadows and make the country transparent.
The deputy minister expects less electricity to be used for mining in the future as the industry moves towards less energy-intensive mining protocols. Nonetheless, it is clear that mining facilities will continue to consume electricity, Interfax news agency quoted Shpak as saying. He further emphasized:
Our position is completely clear – mining must be recognised, regulated and established as an industrial activity.
Bitcoin mining is one of the key crypto-related activities that Russian authorities are currently working to legalize, despite the Bank of Russia’s call for a blanket ban on all of these activities. A bill aimed at achieving this goal was introduced to Russia’s parliament in late April. The draft legislation was recently revised and lawmakers withdrew a proposal to introduce a one-year tax and customs amnesty for mining entities.
Officials in Moscow argue that Russia should develop the industry, citing its competitive advantage in terms of abundant energy resources and favorable climate. However, Russian miners have been targeted in Western sanctions for invading Ukraine to deprive the country of opportunities to circumvent restrictions. This year, Russia’s share of the global average monthly computing power has fallen to 4.66%.
Do you think electricity consumption in the Russian crypto mining industry will continue to grow after industry regulation? Share your expectations in the comments section below.
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