Power outages

Putin warns against crypto mining in Russia

Putin warned that the uncontrolled growth of electricity consumption for crypto mining could lead to "power outages in certain regions".

(Bild: ©Paradorn - stock.adobe.com)

Russian President Vladimir Putin has warned against cryptocurrency mining in his country in view of the high electricity consumption. Currently, "almost 1.5 percent of total electricity consumption" is accounted for by crypto mining, Putin said on Wednesday.

This figure "continues to grow", the president warned. Russia is one of the most important countries for mining new crypto coins. The operators of thousands of computers, often housed in large halls, validate transactions and receive new cryptocurrency in return.

However, the Kremlin is skeptical of the unregulated industry and the Duma is currently working on a law to tighten controls. The draft before the Russian parliament provides for a limit on licensed mining companies and allows the government to ban mining in certain regions.

Power outages feared
Putin warned that the uncontrolled growth of electricity consumption for crypto mining could lead to "power outages in certain regions". According to the report, three Siberian regions have already experienced power shortages due to intensive crypto mining. Siberia has long been a stronghold of crypto mining due to its cheap electricity and cold weather.

The Russian president did not explain how Russia should tackle the problem or whether he was proposing restrictions on mining, but called for "timely decisions". He also called for an acceleration in the introduction of a "digital rouble", an official digital currency backed by the country's central bank.