Russian authorities give green light to crypto mining in Siberia
The Russian government announced on February 8 that it would begin providing direct financial support to a cryptocurrency mining operation set to launch in Siberia later this year.
According to Russian media, The Bitriver-B company will manage and operate the facility with 30,000 crypto mining machines. It will employ 100 workers and run on 100 megawatts drawn from the region’s local power grid, according to Russian language RBC.
The $12 million crypto mining center is set to open in Eastern Siberia, with direct support from the local government. The new center is located in Buryatia, a republic in Eastern Siberia, and is currently under construction but nearing completion.
Located in the village of Mukhorshibir, it is reportedly allowed to operate with zero land and property taxes, insurance premiums reduced to 7.6%, and a reduced income tax rate, per RBC. After connecting the plant to the unified national power grid, the electricity tariff will be reduced by about half, officials say.
The government leader for the project is the state-owned company for the development of the Far East.
The news comes as sanctions continue to rain down on Russia following its invasion of Ukraine, as well as Russia’s announced completion of its pilot CBDC program, which it began testing last year.
It also comes after a thin 2022 for the crypto mining industry that has writ large – especially amid outright moratoriums in Canada and the US – the industry looked set to hit in 2023.
Add to that a recent revelation by BlockFi, the bankrupt crypto-lending platform, which recently announced that it was forced to take a two-thirds loss on its $21 million loan to Bitcoin mining company BitFarm, coupled with rising energy costs due to Russia . /Ukraine war, 2022 was a very difficult year for those in the mining business.
But like a phoenix rising from the ashes, Bitcoin recently reached a new all-time high in hashrate, one of the best indicators of the strength of the Bitcoin mining network.
Now with the Siberian government doubling down on building its own US$12 million mining facility, the mining industry appears to have a clear path forward in Russia, while it remains banned in countries such as China.
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