Russia Proposes Residential Crypto Mining Ban: The End of Home-Based Mining Operations

Kremlin advisors are proposing a ban on home crypto mining operations in Russia or certain regions. The reason cited for the proposal is to prevent fires in residential buildings. Increased power consumption by amateur miners has been blamed for overloading the grid, resulting in breakdowns and blackouts. 

Energy Experts Propose Ban on Mining Cryptocurrency in Russian Homes

An advisory body to the Russian President, the State Council’s Energy Committee, has put forth a recommendation to ban crypto mining in residential areas. The reasoning behind the proposal is to reduce the risk of fires, according to local media reports.

The proposal calls for a complete prohibition of crypto mining in homes or apartment buildings across the country or in specific regions experiencing energy shortages, such as Moscow and the Moscow Oblast.

Crypto mining, which serves as a supplementary source of income for many Russians, particularly in areas with low-cost electricity, currently lacks regulation. A bill aimed at addressing this issue is currently under review by the State Duma, the lower house of the Russian parliament.

Additionally, the Energy Committee of the State Council has recommended that the federal government grant regional authorities the power to impose additional taxes on cryptocurrency mining, as reported by Izvestia in a report citing minutes from a meeting held in December.

Anton Tkachev, a member of the State Duma Committee on Information Policy, Information Technologies, and Communications, supports the proposed ban on crypto mining in residential areas and energy-deficient regions.

He notes that industrial mining farms already consume large amounts of energy and that energy security is a pressing concern, especially for small towns with limited resources to maintain and repair energy systems and facilities. Tkachev also highlighted the risk of mining equipment causing fires in private homes.

The Russian Ministry of Energy, which supports the legislative regulation of crypto mining, has acknowledged the strain put on distribution networks in residential areas due to the increase in coin minting in households, as reported by Russian energy companies.

The Irkutsk Oblast region, in particular, has become a popular location for home mining, with residents taking advantage of low, subsidized electricity rates to set up crypto farms in basements and garages. However, media reports indicate that mining hardware has been found at the site of 23 fires in the region during the first half of 2022 alone.

Johnson Philip

Johnson Philip is a passionate cryptocurrency enthusiast and writer for CoinSEM.com. He has been following the crypto industry for years, and has a deep understanding of the various technologies and trends driving the market. Johnson has written extensively on topics ranging from blockchain development to ICO analysis and is known for his ability to translate complex technical concepts into easy-to-understand language.