Russia Moves to Ban Cryptocurrency Mining Amid Energy Concerns

Recent developments from Russia have sparked concerns in the cryptocurrency sector. The country has recently permitted the use of Bitcoin (BTC) and other cryptocurrencies for international transactions.

However, a contrasting announcement from Deputy Energy Minister Yevgeniy Grabçak indicates a crackdown on cryptocurrency mining due to significant electricity consumption.

Speaking at the “RBK Tech Forum” in Moscow, Grabçak highlighted an electricity shortage in various regions linked to the high energy demands of crypto miners. He noted that these demands have led to power outages in specific areas, particularly in the Far East and southern Siberia. Grabçak mentioned that the government plans to impose a ban on mining activities in certain regions to address these challenges.

This move follows a law approved by President Vladimir Putin on August 8, which legalized cryptocurrency mining across Russia.

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Under this legislation, individuals and companies authorized by the government are allowed to mine cryptocurrencies, provided they adhere to specific energy consumption thresholds. The tension between promoting crypto innovation and managing energy resources appears to be a critical issue for Russian authorities as they navigate the complexities of the digital currency landscape.

Alexander Stefanov