Russia regulates cryptocurrency mining to address energy concerns
Date
7/18/2024 8:48:13 AM
(MENAFN) Russia, known as one of the world's major cryptocurrency mining hubs, faces increasing scrutiny and regulatory efforts from the Kremlin due to concerns over its unregulated nature and energy consumption. During a televised meeting with government officials, President Vladimir Putin highlighted that cryptocurrency mining now consumes nearly 1.5 percent of the country's total electricity consumption and continues to escalate.
Putin expressed alarm over the unchecked growth in energy usage for cryptocurrency mining, warning that it could lead to power shortages in specific regions. Already, three Siberian regions have reportedly experienced power deficits due to intensive mining activities, underscoring the seriousness of the issue.
While Putin did not specify immediate measures to address the problem, he emphasized the need for timely decisions. Discussions on a comprehensive bill to regulate cryptocurrency, set to be debated by Russian lawmakers next week, aim to limit large-scale mining to authorized companies and empower the government to restrict mining in regions facing energy supply constraints.
Historically, Siberia has been favored for cryptocurrency mining due to its combination of low temperatures and inexpensive electricity. However, Moscow remains cautious about embracing an industry that operates outside conventional government controls.
In parallel to these concerns, Putin advocated for accelerating the introduction of a "digital ruble," an official digital currency backed by Russia's central bank. This move is seen as part of Russia's strategy to integrate digital financial technologies under regulated frameworks while mitigating risks associated with unregulated cryptocurrency mining activities.
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