Russia Proposes a Ban on Cryptocurrency Mining in Residential Areas

Russia Proposes a Ban on Cryptocurrency Mining in Residential Areas

According to local media reports, the State Council’s Energy Committee advises the Russian president, who has suggested a ban on creating digital currencies in residential areas to lower the risk of fires. 

Cryptocurrency mining, a popular source of additional income for many Russians, is currently unregulated in the country. However, a bill aimed at regulating the activity is currently under review in the State Duma, the lower house of the Russian parliament.

Experts Propose Additional Taxes on Cryptocurrency Mining to Address Energy Concerns

According to a report by the news daily Izvestia, energy experts have suggested that the federal government should grant regional authorities the power to impose additional taxes on cryptocurrency mining. 

One committee member, Anton Tkachev, believes that the push to ban mining in residential areas and energy-deficient regions is a logical move. He argues that industrial mining farms already consume necessary amounts of energy and that mining in residential areas can lead to increased energy consumption and higher energy costs for residents.

Support From The Russian Ministry of Energy Regarding Crypto Mining 

The Russian Ministry of Energy supports the idea of regulating crypto mining; however, it has raised concerns about the strain it puts on residential power distribution systems. This has led to a surge in home mining in the Irkutsk Oblast area, where residents use the low cost of electricity to set up crypto-mining farms in their homes. This has caused an increase in fires due to the mining equipment, with 23 incidents reported during H1 of 2022.

As the use of cryptocurrency continues to grow, governments need to consider the potential impact on energy consumption and the environment. The proposed regulation in Russia is a step in the right direction to ensure that cryptocurrency mining is done sustainably and responsibly.