Between Worlds The State of Bitcoin Mining in Russia

The war and its effects have made Russia, perhaps sometimes unwittingly, a catalyst for change in the post-war global order. And this has also impacted Russia's nascent Bitcoin mining industry.

Russia is now one of the most important players in Bitcoin mining, but language barriers and the industry's secrecy have made it difficult to obtain reliable information about the country's Bitcoin mining sector.

Blockspace has compiled the following report by veteran Bitcoin and political reporter Anna Baydakova, which you can download by filling out the form below. This report provides a guide to the current state of Russia's mining industry, including key players, related regulations, the energy landscape, international trade pipelines, and more. Bitcoin mining in the US is no longer a hot topic as AI/HPC dominates, so it's important for companies to be aware of mining opportunities outside the US.

$122 Million Loss: How Untaxed Crypto Mining is Harming Russia

Despite legalizing the sector last year, underground crypto operations are evading the attention of the federal tax authority.

Tax Evasion and Hidden Mining Centers

Millions of dollars in undeclared income from illegal crypto mining are escaping Moscow's attention.

Despite Russia legalizing crypto mining in August last year, many informal mining operations remain undetected by the federal tax authority. This widespread tax evasion has reportedly cost the country over $122 million in lost tax revenue.

According to reports from local Russian outlets, most illegal mining centers exploit abandoned factories and farms in remote areas with existing electricity connections. Their unusually high power consumption and frequent disruptions to the power grid reveal their presence.

Current Mining Ban and Enforcement Efforts

According to current law, corporations and individual entrepreneurs must join a special registry to mine. Private citizens can mine without registration if they consume less than 6,000 kilowatt-hours of energy per month. This law specifically prohibits energy companies from mining. It also bans individuals whose records of economic, extremist, or terrorist crimes have not yet been expunged.