Putin warns against scams in cryptocurrencies in Russia
Russian President Vladimir Putin has warned about the high power consumption for cryptocurrency mining in his country. Currently, "almost 1.5 percent of the total power consumption" is going towards crypto mining, Putin said in a televised meeting with government officials. This number "is growing further," the president noted.
Russia is one of the most important countries for mining new cryptocurrencies. Operators of thousands of computers, often housed in large halls, validate transactions and receive new cryptocurrency in return.
The Kremlin, however, is skeptical of the unregulated industry, and the Duma is currently working on a bill to strengthen control. The draft law before the Russian parliament proposes limiting the number of authorized mining companies and allows the government to ban mining in certain regions.
Putin warned that uncontrolled growth in power consumption for crypto mining "could lead to power outages in certain regions." According to him, three Siberian regions have already experienced power shortages due to intensive crypto mining. Siberia has long been a hub for crypto mining due to its cheap electricity and cold weather.
The Russian president did not specify how Russia should address the problem or if he is proposing mining restrictions, but he called for "timely decisions." He also called for the acceleration of the introduction of a "digital ruble," an official digital currency backed by the country's central bank.
Cryptocurrencies have become a significant energy consumer in Russia, with President Vladimir Putin expressing concerns about their increasing power consumption surpassing 1.5% of the nation's total consumption. Despite Russia's role as a major player in cryptocurrency mining due to advantages like cheap electricity and cold weather in regions like Siberia, Putin's government is considering restricting the industry to manage power consumption, possibly limiting authorized mining companies and prohibiting mining in certain areas.
