News
Putin warns of blackouts caused by ‘uncontrolled’ cryptocurrency mining
President Vladimir Putin warned on Wednesday that unregulated cryptocurrency mining risks overwhelming Russia’s power grid and causing widespread power outages.
“An uncontrolled increase in electricity consumption for cryptocurrency mining could lead to energy shortages in certain regions,” Putin told senior government officials at a meeting focused on the economy.
The Russian Energy Ministry estimates that cryptocurrency mining consumes an average of 16 billion kilowatt-hours per year — or nearly 1.5% of Russia’s total electricity consumption.
“The number continues to grow,” Putin said, listing the relatively cheap cost of electricity in Russia and access to equipment as some of the factors that have led to the rise in cryptocurrency mining.
Despite its restrictive cryptocurrency laws, Russia was the most second largest cryptocurrency mining country after the United States in 2023. Previous leaders China and Kazakhstan have clamped down on cryptocurrency mining activities in recent years.
A viral Telegram game promises cryptocurrencies for clicks. What’s the catch?
Read more
Investigative journalists recently named the North Caucasus republic of Dagestan — which was taken over by long blackouts largely due to aging infrastructure — such as the “capital” cryptocurrency mining in Russia.
Putin shared on Wednesday the concerns from regional authorities that mining farms could leave “new businesses, residential areas and social facilities with supply disruptions and put promising investment and infrastructure projects on hold”.
The Kremlin leader said he had ordered tax and tariff regulations for miners and called for a federal law to address the issue, which appears to have taken on renewed importance amid devastating power outages in southern Russia on Tuesday.
In 2020, Putin signed a law that legalized cryptocurrencies as digital financial assets but banned their use to pay for goods and services. Russia established the blockchain-based “Digital Ruble” as a new form of legal tender in 2023.
Last week, Russian lawmakers moved to legalize cryptocurrency mining and at the same time banning the circulation of cryptocurrencies in Russia.
…we have a small favor to ask. As you may have heard, The Moscow Times, an independent news source for over 30 years, has been unfairly labeled a “foreign agent” by the Russian government. This blatant attempt to silence our voice is a direct attack on the integrity of journalism and the values we hold dear.
We, journalists at The Moscow Times, refuse to be silenced. Our commitment to providing accurate and impartial reporting about Russia remains unwavering. But we need your help to continue our critical mission.
Your support, no matter how small, makes a big difference. If you can, support us monthly from as little as $2. It’s quick to set up, and you can rest assured that you’re making a meaningful impact every month by supporting open, independent journalism. Thank you.
Continue
Not ready to support today?
Remind me later.
×
Remind me next month
Thank you! Your reminder is set.
We will send you one reminder email per month from now on. For details on the personal data we collect and how it is used, please see our Privacy Policy.