Russia Becomes World’s Second-Largest Crypto Miner

[Weezenhofnar]

Russia's rising position as the second-largest crypto miner is a testament to the growing popularity and profitability of cryptocurrency mining.

[FP91G]

It is difficult for a person not from Russia to understand what the phrase means: "The law is Taiga, the Prosecutor is the Bear." In the middle of nowhere there are other laws and there will be many hunters in the taiga for your equipment.
It is not a fact that installation of equipment In the middle of nowhere will be more profitable for you. Local officials, bandits will come to you in delegations and demand a share of the business. And those who do not share, usually the equipment disappears.

I don't want to sound like I understand how Russia "works" because I don't! but I do get your points and agree with them, I have a Russian friend who moved his mining operation to another country and he did mention that it was pretty unsafe to mine in Russia for many reasons including the ones you mentioned, so it does make sense that it's pretty difficult for the regular people to deploy large operations there, but what about state-level operations or some Russian oligarchs who know how to protect their mining farms? do you think such people can/would invest in BTC mining?

In the taiga, electricity is 1.5-2 cents, but it is dangerous there; in Moscow, electricity is 5-6 cents, but it is safe there. I do not know what the oligarchs are doing in Russia, but if they own power plants, then the cost of electricity for them in the taiga is 0.1-0.2 cents. If you install a mining plant nearby, then even the oldest ASICs will mine profitably.

[safar1980]

More than 60% of mining equipment entering Russia is imported using "gray" schemes, according to Intelion Data Systems. Because of this, according to various experts, the state receives less in the form of tax revenues from 5 to 10 billion rubles. in year.

This seems to be true, there may be problems with the guarantee in official services in Russia, and ASICs will have to be taken to China. But if the guarantee ends, then the services repair any asics for money.

[paid2]

In the taiga, electricity is 1.5-2 cents, but it is dangerous there; in Moscow, electricity is 5-6 cents, but it is safe there. I do not know what the oligarchs are doing in Russia, but if they own power plants, then the cost of electricity for them in the taiga is 0.1-0.2 cents. If you install a mining plant nearby, then even the oldest ASICs will mine profitably.

May I ask why do you consider the taiga as a dangerous area regarding to BTC mining ? I mean, why would it be more dangerous than Moscow area ?

More than 60% of mining equipment entering Russia is imported using "gray" schemes, according to Intelion Data Systems. Because of this, according to various experts, the state receives less in the form of tax revenues from 5 to 10 billion rubles. in year.

This seems to be true, there may be problems with the guarantee in official services in Russia, and ASICs will have to be taken to China. But if the guarantee ends, then the services repair any asics for money.

Thanks for the link. It is very interesting.

I've just read the article, I am not Russian and I speak very bad Russian. If I understood correctly, they consider ASICs imports as "grey" because they declare a lower value than the real value of the equipment? They declare the ASICs as used when they receive them new, is that right? Knowing the mining equipment manufacturers, this would only be a "half" lie  I have the feeling that no ASIC is really new when sold, I always receive them with traces of use even when ordered as brand new (but I have only made deals with Bitmain almost, considering their reputation I am not surprised)
For my part this has always been the case, I once received a pallet of S19s that my Shenzhen seller had declared as being totally something else, luckily customs didn't paid attention to that.

[DaveF]

More than 60% of mining equipment entering Russia is imported using "gray" schemes, according to Intelion Data Systems. Because of this, according to various experts, the state receives less in the form of tax revenues from 5 to 10 billion rubles. in year.

This seems to be true, there may be problems with the guarantee in official services in Russia, and ASICs will have to be taken to China. But if the guarantee ends, then the services repair any asics for money.

Makes you wonder if some of the gear is actually being imported at all. You can't mine in China, but you can in Russia. Someone in China 'sells' gear to Russia, gets it close to the border and it just never leaves China but sits mining in an empty warehouse or factory in China.

Probably not important since as of now there really does not seem to be much physical proof of the gear mining or even existing.

No pool or service that is located in a country that has sanctions against Russia at the moment would want to deal with this so it would have to be at a pool that does not care.

-Dave

[goldkingcoiner]

Great, now that Russia has become the second largest crypto miner in the world, the western countries and their allies will want to push down even harder on crypto with more regulational nonsense and sanctions. Not that they did not want to do exactly that in the first place, but now they have found an excellent reason to stay on their course with an even higher rate of speed. All the anti-coiners are going to have a field day with this news. I think that Kasachstan and countries around Russia should put in some more effort to take the top places. They have cheap electricity, so nothing is stopping them.

[mikeywith]

Great, now that Russia has become the second largest crypto miner in the world, the western countries and their allies will want to push down even harder on crypto with more regulational nonsense and sanctions. Not that they did not want to do exactly that in the first place, but now they have found an excellent reason to stay on their course with an even higher rate of speed.

China dominated BTC mining for years, I am not talking about second largest or 20% or anything like that, it was 60% at best, at one point, Chinese mining pools had pretty close to 90% of the total hashrate, with more than half of that hashrate physically located in China, that is worse than Russia becoming the second largest BTC miner as far as the west is concerned.

Also, I don't think the West (mainly the U.S since that's what the west is all about if we are going to be somehow honest) are that stupid, they know and see the future of BTC, and they probably don't want to be left behind while other countries move closer to adopting BTC.

[philipma1957]

Great, now that Russia has become the second largest crypto miner in the world, the western countries and their allies will want to push down even harder on crypto with more regulational nonsense and sanctions. Not that they did not want to do exactly that in the first place, but now they have found an excellent reason to stay on their course with an even higher rate of speed.

China dominated BTC mining for years, I am not talking about second largest or 20% or anything like that, it was 60% at best, at one point, Chinese mining pools had pretty close to 90% of the total hashrate, with more than half of that hashrate physically located in China, that is worse than Russia becoming the second largest BTC miner as far as the west is concerned.

Also, I don't think the West (mainly the U.S since that's what the west is all about if we are going to be somehow honest) are that stupid, they know and see the future of BTC, and they probably don't want to be left behind while other countries move closer to adopting BTC.

Or they will want to pivot to LTC/Doge with the aid of Musk.

I only wish I could  be 30-35 to see how this sha-256 vs scrypt ends up. Around 2060 (I would be 103)

if I were 30 I would be 67 in 2060.

So far BTC has not solved scaling and fees for the lower block rewards that are around the corner.

2048  blocks are 0.04882812
2052 blocks are  0.02441406
2056 blocks are  0.01220703
2060 blocks are  0.00610351 >>> this makes me think BTC will be a bridge coin to something else


Everything I come up with for btc by 2060 is pretty much a fail for worldwide currency.  You would need a perfectly done LN node for things to work .

Scrypt is far easier to do  this due to 2 LTC block and 10 DOGE blocks every 10 minutes.

Obviously Many moves will be done with east vs west or left vs right or communist vs capitalist as the 'players' making moves.

[safar1980]

Thanks for the link. It is very interesting.

I've just read the article, I am not Russian and I speak very bad Russian. If I understood correctly, they consider ASICs imports as "grey" because they declare a lower value than the real value of the equipment? They declare the ASICs as used when they receive them new, is that right? Knowing the mining equipment manufacturers, this would only be a "half" lie  I have the feeling that no ASIC is really new when sold, I always receive them with traces of use even when ordered as brand new (but I have only made deals with Bitmain almost, considering their reputation I am not surprised)
For my part this has always been the case, I once received a pallet of S19s that my Shenzhen seller had declared as being totally something else, luckily customs didn't paid attention to that.

The cost of taxes is 15-20% of the amount of equipment imported into Russia, and since the equipment is expensive, such a discount is very good. In America, it is known how many ASICs each miner has, but in Russia there is no such information.
If you are interested in the ASIC route to Russia, then a lot of equipment comes from Kazakhstan, and there are no customs duties at the border. Some of the equipment is smuggling or falsification of customs documents.

[FP91G]

In the taiga, electricity is 1.5-2 cents, but it is dangerous there; in Moscow, electricity is 5-6 cents, but it is safe there. I do not know what the oligarchs are doing in Russia, but if they own power plants, then the cost of electricity for them in the taiga is 0.1-0.2 cents. If you install a mining plant nearby, then even the oldest ASICs will mine profitably.

May I ask why do you consider the taiga as a dangerous area regarding to BTC mining ? I mean, why would it be more dangerous than Moscow area ?

"The law is Taiga, the Prosecutor is the Bear."
There are no police in Taiga. The bandits can take the ASICs and no one else will find them.
And if you bought ASICs that arrived in the country unofficially, then the police will have requests for you. I know that when buying large quantities of equipment, the seller is obliged to transfer to the buyer data on the passage of customs control.

[Wind_FURY]

Russia has become the world’s second-largest cryptocurrency mining country this year, the Kommersant business daily reported Friday, citing Bitriver, Russia’s largest bitcoin mining provider.

While the United States remains by far the world's largest crypto miner, boasting 3-4 gigawatts of mining capacity, Russia’s generating capacity reached 1 gigawatt in January-March 2023.

In taking second place for the first time, Russia took a spot previously occupied by Kazakhstan, which introduced restrictions on crypto mining activities in 2022 and now ranks ninth, Kommersant cited Bitriver as saying.

 

I personally am not very surprised. But the article didn't mention why, or what caused the surge in hashing power within their region. I'm not blowing my own trumpet or anything like that, but I posted about the possibility that Russian Oil could be used as an energy source to mine Bitcoin as a means to go around sanctions and "export" their Crude Oil.

Surging hashing power also coincides with the Russian Finance Minister's statement made last month.

https://tass.com/economy/1608715

Bitcoin will probably have its own use in their "unrestricted" cross-border digital payments protocol. 🤔

[Mate2237]

These are the two world powers in technology. Russia is really trying in the cryptocurrency ecosystem inspired of the war they are still taking second position of the bitcoin mining field. Russia would have taken the first position if not the war  . I think Russia has the number me solar bitcoin mining company in the world. Russia has the power to mine bitcoin very well, I'm even suspecting that after the war Russia is going to take the first position in mining even they have not adopted bitcoin has their legal tender in the country. And when Russia will adopt bitcoin as their legal tender, the present narrative of bitcoin will change to good.

[safar1980]

Russian Miners Mint Crypto Worth $700 Million a Year, Mining Bill Postponed
"Russian Crypto Miners Produce Coins for up to 60 Billion Rubles in 2022
Miners operating in Russia have minted cryptocurrencies for an estimated 50 – 60 billion rubles ($620 million – $740 million) last year, the Director of the Skolkovo Fintech Hub Pavel Novikov announced, quoted by the Prime business news agency."

I do not know what data these statements are based on, but there are a lot of miners in Russia and they do not leave for other countries.

[Lida93]

This a good development for Russia, with the ongoing war between Russia and Ukraine one may think that they (Russia) ain't putting much energy in other areas of their country but just on the war, and hopefully when the world comes to an end of which it surely will and Russia may possibly overtake the USA in their position as number one in the world in crypto mining. And this competition could promote some level of decentralization in hash rate in the policies attached by the different countries.

[safar1980]

This a good development for Russia, with the ongoing war between Russia and Ukraine one may think that they (Russia) ain't putting much energy in other areas of their country but just on the war, and hopefully when the world comes to an end of which it surely will and Russia may possibly overtake the USA in their position as number one in the world in crypto mining. And this competition could promote some level of decentralization in hash rate in the policies attached by the different countries.

Russia can produce a lot of electricity and the country does not need so much.
Russia sells a lot of electricity to other countries, but the state does not want to develop mining in its territories.
I don't know about mining projects with state participation, and most likely all miners are private companies.

[Agbe]

If not the war Russia would have been the first with a very big margin to other countries. Russians are bitcoin enthusiast. And I still believe that after the war and when Russia settle down, they would still take the first position on mining on bitcoin and the uses of it. For Russia to take the second position in the midst of the war means they are very much interesting on the technology. And they are ready to adopt it and use it.

[safar1980]

If not the war Russia would have been the first with a very big margin to other countries. Russians are bitcoin enthusiast. And I still believe that after the war and when Russia settle down, they would still take the first position on mining on bitcoin and the uses of it. For Russia to take the second position in the midst of the war means they are very much interesting on the technology. And they are ready to adopt it and use it.

The war does not interfere with mining, because China is close. Import of equipment from Kazakhstan without taxes.
In Russia, a law on mining is to be passed this year, which will not allow mining where miners are currently working.
And a 13-15% tax on profits may seem like a lot.

[FP91G]

“In terms of global mining capacity, Russia, according to expert estimates, ranks second in the world with a hashrate share of 13-15%, second only to the United States,” Ogienko from BitRiver quotes figures. — Today in our country 1.3-1.7 GW of electric power is consumed for mining, 60% of the market belongs to industrial data centers from 10 MW, and 40% is distributed in the retail segment. About 300,000 mining devices operate in Russian specialized data centers.”
https://www.rbc.ru/crypto/news/6486f59f9a7947490d1c7b54

[Synchronice]

I don't know if this is good or bad. I mean, it can be both. Russia has quite a few advantages over USA for instaance. They have land area, they have huge cold area, they have good realtions with China which is the manufacturer of one of the most common miners (Bitmain), they have quite a few sources of energy. So this seems to me quite a few pros to the country to invest more in mining. Ig they can't export the energy they produce, they can use it to mine. They don't even have to bitch or "negociate" with western countries to "please buy our energy so that we can keep funding this war"!!!

On the other hand, it may be good as a way of taking away the monopoly of the USA in mining! A bit more decentralised!

Are you dead serious? 60% of their land area is unlivable, can Siberia be considered as an advantage? Russia is 8th with oil reserves, the USA is 11th but the USA holds the world's largest recoverable oil reserve. I don't speak about other advantages that the USA has over Russia, including the economy, universities, businesses like Walmart, Apple, Microsoft, Facebook, Twitter, Ford, etc.

[darkv0rt3x]

I don't know if this is good or bad. I mean, it can be both. Russia has quite a few advantages over USA for instaance. They have land area, they have huge cold area, they have good realtions with China which is the manufacturer of one of the most common miners (Bitmain), they have quite a few sources of energy. So this seems to me quite a few pros to the country to invest more in mining. Ig they can't export the energy they produce, they can use it to mine. They don't even have to bitch or "negociate" with western countries to "please buy our energy so that we can keep funding this war"!!!

On the other hand, it may be good as a way of taking away the monopoly of the USA in mining! A bit more decentralised!

Are you dead serious? 60% of their land area is unlivable, can Siberia be considered as an advantage? Russia is 8th with oil reserves, the USA is 11th but the USA holds the world's largest recoverable oil reserve. I don't speak about other advantages that the USA has over Russia, including the economy, universities, businesses like Walmart, Apple, Microsoft, Facebook, Twitter, Ford, etc.

Unlivable? Maybe. But machines doesn't need to "live". They need to work. And even so, when the market demands, people adapt! Never underestimate the power of Bitcoin. If the county embrace mining, they will find ways to make those 60% livable. Or at least in a way they can manage farms!
And don't forget that China is friends with Russia. China holds the monopoly of ASIC manufacturers. See:
https://www.asicminervalue.com/manufacturers