Russia is increasingly enacting more detailed regulations in the crypto sector. In August, President Vladimir Putin legalized crypto mining. Since then, the country has introduced new regulations to align crypto-mining activities with national energy demands.
The recent additional regulations include both outright bans and seasonal restrictions, set to take effect early next year.
Russian Government Approves List of Regions Banned from Crypto Mining
TASS, Russia’s leading state news agency, reports that Russia plans a six-year ban on cryptocurrency mining from January 1, 2025, to March 15, 2031, in 10 regions. These regions include Dagestan, Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia, North Ossetia, Chechnya, Donetsk, Lugansk, Zaporizhzhia, and Kherson.
In some areas like Irkutsk, Buryatia, and the Trans-Baikal Territory, Russia will restrict mining activities instead of enforcing a total ban. These regions will pause mining operations from January 1 to March 15, 2025, and from November 15 to March 15 in subsequent years.
TASS highlights that the government does not consider the list of banned and restricted regions permanent and may adjust it based on decisions from the legal committee managing energy sector development. The government aims to maintain a balanced energy consumption through these new regulations.
“This is the so-called interregional cross-subsidization, where the low cost of electricity in regions with regulated contracts is effectively compensated by producers and consumers in other regions. After market liberalization in this area, the restrictions could potentially be lifted, provided, of course, there is sufficient capacity,” Sergei Kolobanov, Deputy Director of the Center for Economics of the Fuel and Energy Complex at the CSR, told TASS.
According to data from Cambridge University, Bitcoin mining in Russia accounts for 4.7% of the global hashrate, down from 11% in August 2021. Meanwhile, miners in the United States hold the largest share of the global hashrate at 37.8%.
Share of Global Hashrate (Monthly Average). Source: CCAFCambridge data also shows that the average monthly hashrate of Russian miners has dropped from 13.6 Eh/s to 8.7 Eh/s. Despite Russia’s legalization of mining, this has not stimulated significant growth in mining activities within the country.
However, in 2024, the Russian government has shown a more open stance toward cryptocurrencies, including permitting cross-border cryptocurrency payments and preparing to launch state-backed cryptocurrency exchanges. Additionally, Russian lawmakers have proposed holding Bitcoin reserves to enhance financial stability.
