Russia is temporarily shutting down crypto mining in several regions to keep the lights on this winter. The government’s worried about energy shortages, especially in Siberia.
Why the Ban?
Siberia’s got cheap electricity thanks to its hydropower plants, making it a popular spot for crypto miners. But with winter’s harsh conditions and increased energy demand for heating, the power grid is struggling. The government’s prioritizing homes and businesses over crypto mining. This ban also extends to areas of Ukraine that Russia claims to have annexed, which are already facing power shortages due to damaged infrastructure.
Siberia’s Energy Crunch
Areas around Lake Baikal, known for their low energy costs, are particularly affected. The influx of miners has put a strain on the local power supply, especially during the peak winter demand. This wasn’t a surprise; Russia’s state news agency hinted at the ban earlier. A Ministry of Energy official even stated that mining bans in certain regions were likely.
The Bigger Picture: Russia’s Crypto Crackdown
This isn’t just a temporary fix. Russia already slapped a 15% tax on all crypto mining and trading. The government says this tax is a fair way to balance the interests of businesses and the state. They estimate that crypto mining gobbles up about 1.5% of the country’s total electricity – that’s a significant chunk. This move is part of Russia’s ongoing efforts to regulate cryptocurrencies, even while allowing experimental use in international payments.
