Russia plans to restrict crypto mining in 13 regions to save electricity

The Russian government is considering imposing cryptocurrency mining restrictions in 13 regions following the adoption of laws targeting the industry.

At the meeting, officials proposed limiting mining activities in regions facing power supply challenges to prevent shortages during peak energy demand seasons.

The government currently plans to adopt such restrictions in Russia’s key crypto mining regions like Irkutsk, as well as occupied Ukrainian regions of Donetsk, Luhansk, Zaporizhzhia and Kherson.

Planned restrictions to last until 2031

Russia’s crypto mining restrictions are planned to be introduced in several regions in Siberia, including the entire Irkutsk region, individual parts of the Republic of Buryatia and the Zabaikalsky Krai.

According to an official communication by the Russian government, the restrictions are expected to be enforced until 2031 during the autumn-winter heating season.

Additionally, the government proposed similar restrictive measures until 2031 in the territories of the Republic of Dagestan, the Republic of North Ossetia-Alania, the Republic of Ingushetia, the Chechen Republic, the Kabardino-Balkarian Republic and the Karachay-Cherkess Republic.

Russia’s Irkutsk is one of its key regions for mining crypto

The proposed restrictions, if approved, would seriously affect Russia’s crypto mining operations, as some key local industry firms like BitRiver heavily rely on cheap electricity in regions like Irkutsk.

Siberian regions like Irkutsk have been attractive to crypto miners due to many favorable conditions such as significant hydroelectric potential of renewable energy, low electricity rates and cold climate.

For example, Bratsk’s hydroelectric power station has an electric power capacity of 4,500 megawatts and is one of Russia’s largest producers of hydroelectricity.

Although the laws laid the groundwork for a regulatory framework for crypto mining, many in the industry have criticized legal uncertainty about aspects of the regulation.

In addition to legal uncertainty, Russia’s new crypto mining laws introduced many restrictions, such as prohibiting foreign persons from mining in the country, as well as allowing the government to ban mining in regions vulnerable to power supply shortages.