The Russian government has banned cryptocurrency mining in 10 regions for six years, the state-run TASS news agency reported. Russia cited the industry’s high electricity consumption rate as the main reason for the ban. Mining operations already account for about 2.5% of U.S. energy use, and cryptocurrencies are particularly electricity-intensive.
The ban will go into effect on January 1 and last until March 15, 2031. The country’s Council of Ministers has also said additional bans may be needed in other regions during peak energy demand. It could also go in the opposite direction. The ban could be temporarily lifted or modified in certain areas if a government committee examines changes in energy demand and deems it necessary.
It has been fully legalized in Russia since November 1, after the country had a rocky relationship with cryptocurrency mining. Miners must register with the Ministry of Digital Development and energy consumption limits will be continuously monitored.
The country banned the use of cryptocurrencies as legal tender in 2022, but allows cross-border payments. The latter is seen primarily as an attempt to circumvent sanctions imposed by Russia following its invasion of Ukraine.
Russia is not the only country pouring money into crypto mining due to the industry’s exorbitant energy demands. Kosovo banned the practice in 2022 to save electricity during the energy crisis. Angola took similar measures in April 2024. The country’s law goes a step further and criminalizes cryptocurrency mining. Several European countries, such as Iceland and Norway, have begun to tightly regulate the industry due to energy shortages.
