Russia is set to limit cryptocurrency mining in certain regions due to power shortages, just months after legalizing the practice. The move was announced by Deputy Energy Minister Yevgeny Grabchak, who indicated that mining restrictions would apply to the Far East, southwest Siberia, and the South until 2030.
Background on Crypto Mining Legalization
In August 2024, President Vladimir Putin signed a law allowing crypto mining under regulated conditions, mandating that participants register with the Ministry of Digital Development. This decision followed a push to use cryptocurrency for international settlements amid Western sanctions.Energy-Intensive Mining Process
Crypto mining, particularly for Bitcoin, demands significant energy as miners compete with powerful computers to secure block rewards. Despite Russia's previously touted "competitive advantages" like abundant electricity and skilled personnel, the recent limitations highlight the challenges of balancing energy needs with crypto activities.
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