Following China’s restriction on cryptocurrency mining, the Irkutsk area of Russia saw its energy usage rates increase by 160 percent.
Following the surrender of Chinese miners, Russia has emerged as one of the leading sites for Bitcoin (BTC) mining activities. According to the Cambridge Bitcoin Electricity Consumption Index, Russian Bitcoin miners account for 11% of the global BTC mining hash rate allocation, trailing both Kazakhstan and the United States.
According to local media outlet RBC, Russian Energy Minister Nikolai Shulginov revealed Wednesday that the administration is currently developing a framework to separate prices between normal usage and cryptocurrency mining.
Shulginov stated that bitcoin miners in Russia should not use domestic electricity rates, noting:
We can’t let miners capitalize on the situation at the expense of low residential electricity tariffs […] In order to maintain the reliability and quality of power supply, we believe it is necessary to prohibit miners from consuming electricity at residential tariffs.
The Irkutsk valley, one of Siberia’s largest, is wealthy in energy resources, with numerous huge hydropower stations in places such as Irkutsk, Ust-Ilimsk, and Bratsk. BitRiver, the country’s major cryptocurrency mining collocation service company, has some crypto mining data centers in the region.
Igor Runets, the founder and Chief executive of BitRiver, said that the company completely supports the department of energy’s latest initiative.
According to Runets, the company pays for its data center electricity at business customer rates, which are “2.5 or 3 times higher than individuals.” He said, “It is fair and economically sound. Moreover, it will help miners enter the legal field, so the state can take the first step towards regulating the industry, which will ultimately lead to the transparency of the entire industry.”