Russia Could Take 18% of Bitcoin Hashrate in Next Major Migration of Crypto Miners, Experts Say – Mining Bitcoin News

Increasing regulatory pressures, tax burdens, and energy costs in countries like the US and Kazakhstan are likely to lead to a new major migration of crypto miners, Russian analysts believe. In such a scenario, Russia has what it takes to occupy up to 18% of the global Bitcoin hashrate, they claim.

Russia could attract half of Kazakhstan’s cryptocurrency miners

The Russian Federation has an opportunity to extend its leadership in crypto mining amid negative developments for the industry elsewhere. According to specialists from Intelion Data Systems, a major Russian importer and distributor of mining hardware, the country’s share of the Bitcoin hashrate can potentially reach 18%.

According to calculations by the Cambridge Center for Alternative Finance, as of January 2022, Russia accounted for almost 4.7% of the global hashrate, ranking it fifth among the top mining destinations. However, the tightening of policies towards the sector in the leading countries may trigger another large migration of miners, similar to that following China’s crackdown on the sector in 2021.

New restrictions on access to cheap energy as electricity prices rise and the introduction of higher taxes may mean relocating up to 6% of the mining capacity of the United States, Canada and China to Russia, as well as about half of the mining capacity of miners from Kazakhstan, the Intelion predicted team, quoted by the crypto page of Russian business news portal RBC.

In that case, Russia’s share of the global bitcoin hashrate could rise to 18%, consuming 3.95 GW of electricity at an average cost of 128 billion rubles (nearly $1.7 billion). In April, the leading Russian mining operator Bitriver estimated that Russia has already climbed to second place in terms of total capacity of equipment involved in mining digital currencies. Timofey Semyonov, CEO of Intelion Data Systems commented:

Russia has every opportunity to change the existing hierarchy of the global crypto mining market. The country has everything you need for this: low electricity costs, reserves of free capacity, developed energy infrastructure in many regions.

Semyonov also highlighted the increased efforts by a number of Russian companies to expand their businesses, as well as government support for the industry. While lawmakers have yet to pass the long-awaited mining law, official statements in Moscow have indicated that Russian authorities intend to use what President Putin called Russia’s “competitive advantages” as a mining hotspot.

In order to create a favorable investment climate, mining in Russia must become a “legal business activity with clear rules of the game,” said Intelion experts. They believe that the banking sector crisis in the US and Europe, which is “just beginning”, will lead to growing demand for Bitcoin as a hedging tool and interest in crypto from traditional financial institutions, which should lead to increasing global mining volumes.

tags in this story

Bitcoin, Consumption, Crypto, Crypto Miner, Crypto Mining, Cryptocurrencies, Cryptocurrency, Power, Hashrate, Kazakhstan, Migration, Miners, Mining, Mining Target, Mining Hotspot, Power Capacity, Relocation, Russia, Russian, USA

Do you agree that Russia has the potential to become a leading crypto mining destination? Tell us in the comment section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchen’s quote: “Being a writer is what I am, not what I do.” Along with crypto, blockchain and fintech, international politics and business are two other sources of inspiration.

Photo credits: Shutterstock, Pixabay, Wiki Commons

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