rnment has published a draft resolution on banning or providing restrictions on mining locally. The ban will take effect on Jan. 1, 2025, and run until Mar. 15, 2031.
Russia’s government has drafted a resolution to ban or restrict cryptocurrency mining in certain regions of the country. The ban will be in effect from Jan. 1, 2025, to Mar. 15, 2031, and will apply to Dagestan, Ingushetia, Chechnya, Kabardino-Balkaria and North Ossetia.
According to the document, the ban will include mining and participation in pools. The order will not be applied in the Luhansk and Donetsk People’s Republics, as well as some localities of the Zaporizhia and Kherson regions.
Moreover, the restrictions will be imposed on certain sites in the Irkutsk Region, Buryatia, and Zabaikalsky Krai during peak load hours. In particular, by 2025, this will be enforced between Jan. 1 and Mar. 15, and in the following years, the ban will be valid from Nov. 15 through Mar. 15. These measures are part of a policy to manage energy consumption and distribute it evenly across different industries.
Experts believe that the crypto mining ban is due to energy shortages and the subsidized price at which electricity is available in some markets. According to Sergey Kolobanov, an expert at the Center for Strategic Research, this mechanism has become one of the arguments used to justify restrictions on interregional cross-subsidization, which compensates for cheap energy in regulated regions. Kolobanov noted that the limitation coincides with the end of the transition period for such benefits. In the future, power privatization should eliminate the need for such bans.
The Cabinet of Ministers added that a similar list could be revised in the light of proposals from an electricity commission advising on what such zones might comprise. Experts say the authorities justified the ban on the grounds of energy shortages and price disparities in electricity. The regulated contract states in question enjoy lower electricity prices, which are effectively cross-subsidized by the producers and consumers of other regions.
As previously reported, on Nov. 18, Russia imposed a 15% tax rule on Bitcoin (BTC) mining profits. The world’s largest country’s current mining ban is a result of ongoing energy shortages and differentiated electricity pricing, as per a previous TASS report.
Furthermore, according to the World Energy Outlook 2023, Russia’s power generation decreased in 2022 due to lower industrial demand and export sanctions, while electricity consumption increased by 5.8% in industrial regions by mid-2023. Subsidized regions, such as Irkutsk, where electricity is sold at $0.01 per kilowatt-hour, attracted miners and strained grids during winter peaks. The ban will help address energy equity and balance such imbalances while preparing to privatize power frameworks.
