Demand for Bitcoin mining in Russia triples amid regulatory shifts and rising prices

Russia saw a sharp rise Bitcoin Mining activity as citizens and companies turn to cryptocurrency mining for additional sources of income, local media outlet Prime reported I mentioned.

According to the report, demand for industrial Bitcoin mining equipment in Russia has tripled compared to the same quarter of 2023.

This rise coincides with a profitable period for Bitcoin miners, driven by a significant rise in cryptocurrency prices in 2024. Over the past year, institutional miners have reported significant growth in their Bitcoin reserves, further underscoring the sector’s profitability.

What drives the Bitcoin mining industry in Russia?

Market watchers have linked the spike to regulatory changes in Russia, which have provided clarity to miners and facilitated industry expansion while maintaining oversight.

Last year, the Russian Govt Legal crypto mining Under specific guidelines. These guidelines allow individuals to mine without registration if their energy use remains below 6,000 kilowatt-hours per month. Those who exceed this limit must register as entrepreneurs and comply with additional rules.

Moreover, tax reforms have further shaped the industry. Russia’s updated tax law exempts cryptocurrency transactions from VAT but imposes a 15% tax on extracted assets.

This tax is calculated based on the market value of mined cryptocurrencies at the time of receipt, and miners are allowed to deduct operating costs to determine their taxable income.

Mining facilities must also report the activities of their users regularly to ensure compliance.

Furthermore, Russia’s overall position towards the best digital assets has improved significantly, as Russian Finance Minister Anton Siluanov revealed that Russian companies… Use BTC for international transactions.

However, Russia is taking a measured approach to this sector despite its unprecedented growth. The country recently imposed a Mining ban Which applies until 2031 in 10 regions suffering from energy shortages.

This restriction prohibits cryptocurrency mining and participation in mining pools within these areas, reflecting the government’s efforts to balance energy consumption and economic priorities.