Russia: Billions of dollars soon to be injected into the bitcoin mining industry

Despite the turbulence due notably to the surging energy tariffs, bitcoin miners in Russia persist in their venture. In a strategic move, these industry players plan to inject a colossal sum of 4 billion dollars, a sign of their concrete aspirations.

Russian crypto miners ready to invest 4 billion dollars

Despite economic sanctions, Russia under Putin does not correspond to the idyllic image described by Tucker Carlson. Despite this, the recently re-elected government, with a crushing victory of 87% in this weekend’s elections, is making considerable efforts. Ratification of cryptocurrency and CBDC laws, adoption of blockchain technologies, expansion in the bitcoin mining sector… are all strategies to maintain its technological lead and its position among the richest countries on the planet.

At an event in Irkutsk, Siberia, representatives of the Russian cryptocurrency mining industry announced a potential investment of 4 billion dollars. However, according to the SIA media, this project could be compromised if new prohibitive energy tariffs are imposed by Moscow, CryptoNews points out.

The director of the Russian Industrial Mining Association (IPM), Sergei Bezdelov, stated that this investment aims to develop new data centers, not only for mining cryptocurrencies but also to support the government’s data economy project.

Bezdelov emphasized that these centers could offer space to the government for its project, also providing energy capacities and maintenance staff, potentially saving up to 32.4 million dollars. This initiative could be a way for miners to deter Moscow from increasing energy tariffs, against which they currently find themselves.

Caveat: A Rising Electricity Bill

In Irkutsk, the Russian Ministry of Energy is considering increasing electrical tariffs for crypto miners, to relieve the pressure on the networks. This initiative is worrying as the region has become a pillar of the Russian mining industry.

Sergei Sasim, from the Electric Power Industry Research Center, supports this move, believing that this will discourage newcomers and limit the expansion of existing players. However, despite warnings about energy deficits, Sasim reassures that the Russian energy system will remain largely in surplus.

Irkutsk, home to a quarter of the country’s crypto mining industry, hopes, according to Bezdelov, to benefit from the legalization of the sector to generate more tax revenue.

Bitcoin: An Economic Weapon for Russia?

Russian bitcoin miners see in mining an opportunity to circumvent sanctions. Dmitry Zuev of NGE Farm believes it could create a decentralized international liquidity source. Already, some Russian companies use cryptos to evade sanctions, while BitRiver is investing millions in new mining centers.

This strategy comes in a context where more and more Russian families are emigrating to Latin America to escape the war in Ukraine and its economic repercussions.

With inflation forecasts on the decline and future profitability of BTC mining expected to be greater in Russia than in the United States, cryptos could become a key tool in Russia’s economic struggle.