Russia could be a prominent player in the world of crypto mining, as research has discovered that there are several regions in the country that have become mining hotspots.
There are several regions that have become quite attractive for crypto mining in the Russian Federation, which include Moscow, the country’s capital that offers cheap power.
Crypto farms’ locations
Mining equipment importer Intelion Data Systems recently conducted a study, which concluded that Russia has all the ingredients necessary for it to become a leader in the crypto mining world.
It has surplus electricity generation capacity, low-cost of electricity, and energy infrastructure that is quite well-developed in several areas of the country.
According to researchers, the huge country has seen a rise in interest amongst people to set up new data centers for minting digital coins.
The major task for businesses is to choose the right location for setting up their facilities, which is vital for ensuring the effectiveness of their capital investments.
Timofey Semyonov, the chief executive of the company, pointed out that the main criteria for choosing the location is sufficient electricity supply and the rates.
The study conducted by Intelion Data Systems discovered that the most popular regions in Russia for setting up digital asset extraction facilities last year were the capital Moscow, Karelia, Moscow Oblast, and Buryatia.
Some of the other regions also on the list are the Republic of Khakassia, the Krasnoyarsk Territory, and the Murmansk, Sverdlovsk, and Irkutsk regions.
The first four regions had a high demand for power and the locally generated electrical energy was not enough to meet the requirements.
Crypto miners’ preference
The cost of electricity is the priority for most industrial-scale crypto mining operations and some also consider logistical advantages in the case of regions, such as Moscow.
According to experts, sometimes crypto miners give preference to the logistical advantages as compared to the energy infrastructure.
These are miners who believe that they should set up their crypto farms in regions where not only is the cost of electricity low, but the electricity generation is also higher than its consumption.
The regions that are able to match these criteria are Murmansk, Sverdlovsk and Irkutsk, the Krasnoyarsk Territory, and the Republic of Khakassia.
These regions generate enough electricity to not only fulfill the current demand but also allow more consumers to connect without the distribution networks overloading.
According to the study’s authors, the crypto mining farms provide a solution for using Russia’s excess generation capabilities in an economically viable manner.
Moreover, crypto mining can also be helpful in the expansion of IT infrastructure deployment in Russia, creating new jobs and helping the region increase its budget receipts.
However, it should be noted that Russia has not yet regulated cryptocurrency mining activities, even though the region contributes 5% of the bitcoin mining global hashrate.
Most officials in Moscow believe that crypto mining should be declared an industrial activity and taxes should be implemented on it accordingly.