Crypto miner migration could give Russia control over 18% of bitcoin hashrate
Analysts predict that increasing regulatory pressure, energy costs and tax burden, in countries such as the U.S. and Kazakhstan could lead to a new migration of crypto miners to Russia.
The analysts suggest that Russia has the potential to increase its share of the global bitcoin hashrate to 18%.
An appealing situation for miners
According to experts from Intelion Information Systems, Russia has the potential to attract up to half of Kazakhstan’s cryptocurrency miners and increase its dominance in the crypto mining sector.
They predict that Russia’s share in the global bitcoin hashrate could reach 18%, as other countries face detrimental developments and tightening policies towards the industry.
Russia’s abundant supply of low-cost electricity, powered by nuclear and hydropower sources, is one of the major reasons why it has become a sought-after destination for crypto miners.
The recent introduction of legislation by the Russian government legalizing cryptocurrency mining is expected to further increase the country’s appeal to miners.
Fifth among major mining locations
Currently ranked fifth among major mining locations, Russia’s well-developed energy infrastructure and low electricity costs make it an attractive option for miners seeking to relocate.
The recent migration of miners from China following the country’s crackdown on the industry in 2021 further highlights the potential for Russia to become a major player in the crypto mining market.
“Russia has every opportunity to change the existing hierarchy of the global crypto mining market. The country has everything you need for this: low cost of electricity, reserves of free capacities, developed energy infrastructure in many regions.”Timofey Semyonov, CEO of Intelion Data Systems.
According to experts from Intelion, to promote an advantageous investment environment, mining in Russia must be recognized as a “legitimate business activity with well-defined regulations.”
The analysts anticipate that the ongoing banking crisis in the U.S. and Europe will generate an escalating demand for bitcoin as a hedging tool and increase interest in cryptocurrency among conventional financial institutions, leading to a surge in global mining activity.
If this happens, Russia could increase its share of the global crypto mining market, and it could potentially shift the balance of power in the industry with Russia gaining more control over the production of cryptocurrencies like bitcoin.
This could have a number of implications for the rest of the world, including increased competition among miners, changes in market dynamics, and potential shifts in the geopolitical landscape as Russia becomes more influential in the crypto space.