Putin's Aide Seeks $100 Million to Rival China in Bitcoin Mining

[shinratensei_]

What are electricity rates like in Russia?

I know China has some of the cheapest electricity in the world, which is why they are such a leader in Bitcoin mining today.

That already stated by the article, you think that it must be lower than china, but remember we don't get the data that contained all of the rate of electricity in every country around the world.
Rusian will be a good competitor for china and to make another adoption for the crypto.

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[error08]

Russia has 20 gigawatts of excess power capacity, with consumer electricity prices as low as 80 kopeks (1.3 cents) per kilowatt hour, which is less than in China, RMC said in the presentation. The company initially plans to locate mining computers based on Bitfury chips in individual Russian households to challenge Bitmain by using Russia’s lower power prices.

https://www.bloomberg.com/news/articles/2017-08-08/putin-s-aide-seeks-100-million-to-rival-china-in-bitcoin-mining

Tried to bold the most relevent parts.

Good news for those favoring a decentralized btc mining paradigm. Miners becoming more decentralized could reduce probability of hard forks in the future. This could translate to diminished volatility. Much of bitcoin's negative volatility has been due to uncertainty, fear and sell offs derived from hard fork worst case scenarios. If japan, australia and other nations invest in mining operations that could further decentralize crypto mining which would parallel Satoshi's vision for btc not being centralized within national abstractions

That's mostly bullshit

First, the consumer electricity prices are nowhere near that in Russia. It is more like 4 rubles per kilowatt hour (i.e. 5 times higher that the number given). The tariffs are cheaper for rural areas but they are still on the order of rubles, not around 80 kopeks. Further, the Russian authorities should first decide what to do with Bitcoin per se, i.e. whether allow Bitcoin for personal use and whether allow mining it since issuing money and money surrogates is strictly prohibited by Russian laws, and still more so if Bitcoin is to be treated as a currency. They would need to adopt a special law regarding Bitcoin to address that issue, but nothing has been done so far

Well, I don't know which one is true unless you (deisik) live in Russia? People tend to believe in good news, and that bloomberg article mention about Russian President Vladimir Putin who seek $100 Million, even though we talk about his company but at least He is the president in Russia, right?
You may want to read this article as well : https://news.bitcoin.com/russia-legalize-icos/
as Vladimir Putin's company try to collect money through ICO, and Many similar ICO’s have been able to generate millions of dollars within minutes and hours, and much more over the course of days. It is likely Russia is using this method to instantly gain the revenue to start moving in on China’s hold on bitcoin mining.

[moviebuff777]

I wonder what prompted the u-turn by Russia. They have gone from banning bitcoin outright to wanting to be an industry leader. Remarkable turnaround from them, not that I am complaining. It will help bitcoin and crypto currencies a lot.

I was thinking the same thing. They made it illegal but now they are trying to capitalize on it. I guess they see potential to make a lot of money so they want to get in on the action. Whatever the case, it's good for bitcoin.

[GeraldGregoryy]

What are electricity rates like in Russia?

I know China has some of the cheapest electricity in the world, which is why they are such a leader in Bitcoin mining today.

It's apparently much cheaper than china, even at consumer level

[carlisle1]

I wonder what prompted the u-turn by Russia. They have gone from banning bitcoin outright to wanting to be an industry leader. Remarkable turnaround from them, not that I am complaining. It will help bitcoin and crypto currencies a lot.

I was thinking the same thing. They made it illegal but now they are trying to capitalize on it. I guess they see potential to make a lot of money so they want to get in on the action. Whatever the case, it's good for bitcoin.

they just taking advantage and you are correct as they seen big potentials so investing with bitcoin mining will give them much more money
in coming years china seen this before so I think Russia study this carefully before they enter the system.

[Hydrogen]

That's mostly bullshit

First, the consumer electricity prices are nowhere near that in Russia. It is more like 4 rubles per kilowatt hour (i.e. 5 times higher that the number given). The tariffs are cheaper for rural areas but they are still on the order of rubles, not around 80 kopeks. Further, the Russian authorities should first decide what to do with Bitcoin per se, i.e. whether allow Bitcoin for personal use and whether allow mining it since issuing money and money surrogates is strictly prohibited by Russian laws, and still more so if Bitcoin is to be treated as a currency. They would need to adopt a special law regarding Bitcoin to address that issue, but nothing has been done so far

This is the only picture of a chinese crypto mining operation I've seen.

The caption says: A bitcoin “mine” with a blue tin roof sits next to a hydroelectric power plant in Ngawa Tibetan and Qiang Autonomous Prefecture, Sichuan province.



Here's another picture to give you an example of the number of mining rigs they run.



If russia opens a mining plant they could do something similar in placing their mining operation next to a hydroelectric power plant or another cheap and renewable source of electricity to hit their kilowatt hour figures. The numbers they cite could represent industrial energy usage rather than consumer consumption.

That could be a good point you made about russia and crypto laws. Whatever laws russia has I don't remember them doing anything to impede btc-e servers being located in russia. They also didn't extradite btc-e's owner to the united states. It is possible that shows russia's true stance on crypto whatever their laws say.

[panju1]

I wonder what prompted the u-turn by Russia. They have gone from banning bitcoin outright to wanting to be an industry leader. Remarkable turnaround from them, not that I am complaining. It will help bitcoin and crypto currencies a lot.

I was thinking the same thing. They made it illegal but now they are trying to capitalize on it. I guess they see potential to make a lot of money so they want to get in on the action. Whatever the case, it's good for bitcoin.

It is just one of Putin's aides who has floated this idea. It is not a government-sponsored push. If this goes through, the risk of the Russian government taking action against bitcoin (and by extension one of his aides) will decrease drastically.

[deisik]

If russia opens a mining plant they could do something similar in placing their mining operation next to a hydroelectric power plant or another cheap and renewable source of electricity to hit their kilowatt hour figures. The numbers they cite could represent industrial energy usage rather than consumer consumption.

That could be a good point you made about russia and crypto laws. Whatever laws russia has I don't remember them doing anything to impede btc-e servers being located in russia. They also didn't extradite btc-e's owner to the united states. It is possible that shows russia's true stance on crypto whatever their laws say.

These laws aren't in favor of crypto right now

Basically, you cannot mine coins (at least, not officially) since issuing money or money tokens is explicitly prohibited according to the Law on the Central Bank of Russia. I don't think anyone is going to be prosecuted for that (which I have been telling for years), but they would have to accept a special law in respect to Bitcoin to circumvent this provision if they are to legalize Bitcoin. Regarding Btc-e and its legal operation in Russia, such assumptions are ridiculous since even access to the exchange site was blocked in Russia (btc-e.com), and folks had to use its mirror at btc-e.nz. This is the reality how it stands

[Hydrogen]

Regarding Btc-e and its legal operation in Russia, such assumptions are ridiculous since even access to the exchange site was blocked in Russia (btc-e.com), and folks had to use its mirror at btc-e.nz. This is the reality how it stands

If russian reached btc-e using a mirror redirect. Does it mean russia made a powerful effort to prevent btc-e use in russia. Has internet technology advanced to a point where the russian government can block access to mirror sites as easily as they can main ones? Or does it mean russia isn't putting much time or effort into enforcing anti crypto laws?

In the US there was something known as a lowest priority initiative. Some states had no money or resources to devote towards cracking down on marijuana and so they chose not to enforce laws against owning marijuana plants or carrying marijuana on a conditional basis.

Anyways, long story short, I'm certain Putin loves bitcoin. Russia loves bitcoin. Who doesn't love bitcoin?

[deisik]

Regarding Btc-e and its legal operation in Russia, such assumptions are ridiculous since even access to the exchange site was blocked in Russia (btc-e.com), and folks had to use its mirror at btc-e.nz. This is the reality how it stands

If russian reached btc-e using a mirror redirect. Does it mean russia made a powerful effort to prevent btc-e use in russia. Has internet technology advanced to a point where the russian government can block access to mirror sites as easily as they can main ones? Or does it mean russia isn't putting much time or effort into enforcing anti crypto laws?

In the US there was something known as a lowest priority initiative. Some states had no money or resources to devote towards cracking down on marijuana and so they chose not to enforce laws against owning marijuana plants or carrying marijuana on a conditional basis.

Anyways, long story short, I'm certain Putin loves bitcoin. Russia loves bitcoin. Who doesn't love bitcoin?

Maybe, Uncle Sam doesn't love Bitcoin?

Further, I wouldn't believe anything any political figure out there says, especially in respect to Bitcoin and other cryptos (Putin included but certainly not limited to). As a newest Russian proverb says, man said man did are two different men (actions speak louder than words). Quite naturally that you might not closely follow the events related to Bitcoin in Russia, but just a few days ago a Russian court made a decision banning at one sweep something like 40 Bitcoin exchangers operating in Russia (that was hilarious). The lesson to learn is that you should take anything you hear about Bitcoin in Russia (both good and bad) with a spoonful of salt

[Tamilson]

I wonder what prompted the u-turn by Russia. They have gone from banning bitcoin outright to wanting to be an industry leader. Remarkable turnaround from them, not that I am complaining. It will help bitcoin and crypto currencies a lot.

I was thinking the same thing. They made it illegal but now they are trying to capitalize on it. I guess they see potential to make a lot of money so they want to get in on the action. Whatever the case, it's good for bitcoin.

they just taking advantage and you are correct as they seen big potentials so investing with bitcoin mining will give them much more money
in coming years china seen this before so I think Russia study this carefully before they enter the system.

And have you heard the RMC? Russia wants to develop a coin called Russian Miner Coin and they will fund it as long as they can. And with that mining also bitcoin to surpass China but China will not easily be defeated as China will do anything to make profit. More profit means more money and more money comes with great power to every country.

[Lancusters]

To create a coin that is not enough. Need to get her admitted. Now the image of Russia not inspire confidence in their project. No, I think that Russians will focus on the extraction of existing currencies, but to compete with China it will be very difficult.

[Fatunad]

A company co-owned by one of President Vladimir Putin’s internet advisers plans to raise the cryptocurrency equivalent of as much as $100 million in a push to help Russian entrepreneurs challenge China in bitcoin mining.

Russian Miner Coin is holding a so-called initial coin offering, where investors will use units of ethereum or bitcoin to buy new RMC tokens. These new tokens will have rights to 18 percent of the revenue earned with the company’s mining equipment, according to a presentation posted on its website.

RMC plans to use semiconductor chips designed in Russia for use in satellites to minimize power consumption in computers for crypto-mining, Putin’s internet ombudsman, Dmitry Marinichev, said at at a news conference in Moscow.

“Russia has the potential to reach up to 30 percent share in global cryptocurrency mining in the future," Marinichev said, adding that $10 million from the proceeds of the ICO may be spent developing the processors.

More and more startups are offering tokens as a way to raise money upfront for digital assets in ICOs. Unlike a traditional IPO in which buyers get shares, a startup’s ICO nets you virtual tokens unique to the issuing company or network that grow in value only if the business proves viable.

The U.S. Securities and Exchange Commission last month warned that ICOs may be considered securities and signaled greater scrutiny of the sector, though it stopped short of suggesting a broader clampdown.

Today’s bitcoin mining requires special computers based on chips with minimized power consumption. China’s Bitmain Technologies Ltd. is one of the leading producers of such equipment and also runs Antpool, a processing pool that combines individual miners from China and other countries. Rival Bitfury Group, founded by Valery Vavilov, a Russian-speaking native of Latvia, produces equipment for mining virtual currencies and runs large-scale centers in Georgia and Iceland.

Russia has 20 gigawatts of excess power capacity, with consumer electricity prices as low as 80 kopeks (1.3 cents) per kilowatt hour, which is less than in China, RMC said in the presentation. The company initially plans to locate mining computers based on Bitfury chips in individual Russian households to challenge Bitmain by using Russia’s lower power prices.

https://www.bloomberg.com/news/articles/2017-08-08/putin-s-aide-seeks-100-million-to-rival-china-in-bitcoin-mining

Tried to bold the most relevent parts.

Good news for those favoring a decentralized btc mining paradigm. Miners becoming more decentralized could reduce probability of hard forks in the future. This could translate to diminished volatility. Much of bitcoin's negative volatility has been due to uncertainty, fear and sell offs derived from hard fork worst case scenarios. If japan, australia and other nations invest in mining operations that could further decentralize crypto mining which would parallel Satoshi's vision for btc not being centralized within national abstractions.

So now it becomes China vs Russia on the coin investment and coin mining stage huh? Seems like a naked attempt to try and take over the market and the mining.

What if they spend hundreds of millions on mining equipment and have 60% hashing power. That would not be a good thing. We may have to re-think Bitcoin somewhere in the future if this happens. No government should be investing in this, the whole point of BTC is to get away from it... ughhhhh

This is what im thinking too because they are already serious on engaging on bitcoin already which they do compete already on mining it. If russia would decide to jump in on the trend then we cant do anything about it expect for mining difficulty to jump up. I guess its just really right since i dont really like the feeling that china do all have the power as of now.

[Hydrogen]

Quite naturally that you might not closely follow the events related to Bitcoin in Russia, but just a few days ago a Russian court made a decision banning at one sweep something like 40 Bitcoin exchangers operating in Russia (that was hilarious). The lesson to learn is that you should take anything you hear about Bitcoin in Russia (both good and bad) with a spoonful of salt

Doh. That sucks! Will it be a hard ban? Or will those 40 exchanges merely circumvent the ban with mirror redirects like btc-e may have?

Also where did you find this information?     I'm searching but can't find any news of it.

Even if russia doesn't get into mining, I'm hoping japan, australia, korea or another country will. If another country competes with china in mining, I would guess it won't be one that has strong ties to the united states or to central bankers though. Russia announcing plans to enter the bitcoin mining market could be made in retaliation for the united states latest round of economic sanctions. On some level russia could recognize the US doesn't want anyone to threaten china's mining operations & so russia announces plans they will do that to pressure the US.

[deisik]

Quite naturally that you might not closely follow the events related to Bitcoin in Russia, but just a few days ago a Russian court made a decision banning at one sweep something like 40 Bitcoin exchangers operating in Russia (that was hilarious). The lesson to learn is that you should take anything you hear about Bitcoin in Russia (both good and bad) with a spoonful of salt

Doh. That sucks! Will it be a hard ban? Or will those 40 exchanges merely circumvent the ban with mirror redirects like btc-e may have?

It seems like domain names are banned. This basically means that Internet providers operating in Russia should prohibit access to these sites. And since another law has been recently signed by Putin which obliges VPN service providers (as well as anonymizers, proxies and their likes) to restrict access to such sites as well, you can't even use these tools to circumvent the ban (well, at least hypothetically). Regarding information about the court banning 40 exchangers at once (lol), you may look here

The complete list is as follows:

netex24.net
pro100obmen.net
makoli.com
hot-bit.com
365cash.co
ww-pay.com
newline.online
betatransfer.net
x-pay.cc
baksman.com
24paybank.com
n-obmen.net
trust-exchange.org
bankcomat.com
minedtrade.com
kassa.cc
fastchange.cc
wmglobus.com
goldobmen.com
cointocard.org
lionex.net
orangeexchangepro.com
xchange.is
achange.net
i-obmen.biz
btc2cashin.me
100monet.pro
solidchanger.net
cashex.io
cash-transfers.com
e-obmen.net
obmenkin.com
pmcash.kz
uxbtc.com
bitpayeers.biz
1wm.kz
e-money.cc
exchanger.org.ua
trust-changer.com
bestchange.ru

Expect more to come

[Hydrogen]

It seems like domain names are banned. This basically means that Internet providers operating in Russia should prohibit access to these sites. And since another law has been recently signed by Putin which obliges VPN service providers (as well as anonymizers, proxies and their likes) to restrict access to such sites as well, you can't even use these tools to circumvent the ban (well, at least hypothetically). Regarding information about the court banning 40 exchangers at once (lol), you may look here

The complete list is as follows:

netex24.net
pro100obmen.net
makoli.com
hot-bit.com
365cash.co
ww-pay.com
newline.online
betatransfer.net
x-pay.cc
baksman.com
24paybank.com
n-obmen.net
trust-exchange.org
bankcomat.com
minedtrade.com
kassa.cc
fastchange.cc
wmglobus.com
goldobmen.com
cointocard.org
lionex.net
orangeexchangepro.com
xchange.is
achange.net
i-obmen.biz
btc2cashin.me
100monet.pro
solidchanger.net
cashex.io
cash-transfers.com
e-obmen.net
obmenkin.com
pmcash.kz
uxbtc.com
bitpayeers.biz
1wm.kz
e-money.cc
exchanger.org.ua
trust-changer.com
bestchange.ru

Expect more to come

Much thanks for the info. Maybe I'm naive but I don't think Putin is anti bitcoin or anti crypto. I think the united states and central banks put pressure on russia to pass these types of laws restricting crypto access. It could restrict russia's crypto exposure and force them to rely more heavily on the US dollar as a reserve currency. Russia being hit with so many economic sanctions, bitcoin may have become little more than a bargaining chip for them. Something to be used as an appeasement policy towards the USA and whoever else seeks to regulate crypto growth in russia.

[deisik]

Much thanks for the info. Maybe I'm naive but I don't think Putin is anti bitcoin or anti crypto. I think the united states and central banks put pressure on russia to pass these types of laws restricting crypto access. It could restrict russia's crypto exposure and force them to rely more heavily on the US dollar as a reserve currency. Russia being hit with so many economic sanctions, bitcoin may have become little more than a bargaining chip for them. Something to be used as an appeasement policy towards the USA and whoever else seeks to regulate crypto growth in russia.

Yes, you're kinda naive to think so

And to think that the US and Central banks (I guess you refer to the International Misery Fund, World Bank, and similar financial institutions) are putting sort of pressure on Russia in this regard is bordering on insanity or wishful thinking (if I may put it this way). This is an entirely internal affair, and the US and its minions (like the aforementioned organizations) have nothing to with that. If anything, Russia is moving away from the international payment systems controlled by Washington, DC, so your whole assumption is in fact untenable. In simple terms, you have to face the truth even if you don't quite like it

[youngagethinker]

I wish I live in Russia. Love Putin

Russia will dominate crypto currency world sooner or later.

The best thing about russians is that they are so open minded and they are giving every shot in every new technology. I've read about a news on how putin banned the rothschilds banking cartel in the russian grounds. Its not good to know that our country is having the hard time believing what is cryptocurrencies. Those who pioneered it earlier will have the success and I think our country will be behind in these field again. While praising how good the current system is someone is busy improving and implementing beyond what the present system can offer.

[Sled]

This is the real deal for bitcoin, if ever this is true, we can expect a higher price for bitcoin because the demand for bitcoin is keep on going up and i think that russia and china will become a great competitor in mining bitcoin. This is what we are waiting for, we need more countries to realized that they should not let bitcoin pass to them or else they will not earn huge money.

[pereira4]

What are electricity rates like in Russia?

I know China has some of the cheapest electricity in the world, which is why they are such a leader in Bitcoin mining today.

It's apparently much cheaper than china, even at consumer level

It must depend where you live. In Moscow living expenses are so high compared to the rest of Russia. Also, from what I've heard, the government pays their citizens electricity, water etc.

If it is really cheaper for big corporations to start big mining farms, and with Putin on board, I can see Russia becoming an mining mogul in the next couple of years, surpassing China even.