Key facts
- Moscow, Moscow Region, and parts of Kursk have banned crypto mining until December 31, 2032.
- The ban also prohibits participation in crypto mining pools.
- The measure aims to address power-capacity shortages caused by energy-intensive mining facilities.
- Russia was the second-largest source of Bitcoin's global computing power in Q1.
- Mining consumes approximately 1 GW in the Moscow power system.
Russia has implemented a significant ban on cryptocurrency mining operations in its capital city, Moscow, as well as the surrounding Moscow Region and parts of Kursk. The restrictions, effective until December 31, 2032, also prohibit participation in crypto mining pools. This move by the Russian government, formalized under decree No. 936, is intended to address power-capacity shortages and stabilize regional energy grids strained by the energy-intensive nature of mining.
The decision follows a complex regulatory landscape where Russia legalized registered crypto mining in 2024, only to subsequently ban the activity in numerous regions due to escalating electricity demand. In the first quarter, Russia was estimated to be the second-largest contributor to Bitcoin's global computing power, accounting for approximately 16.4% or 175 exahashes per second. Mining currently consumes about 1 gigawatt in the Moscow power system, with projections indicating data-center capacity could reach 3.6 GW by 2032.
This regulatory action also intersects with Russia's efforts to navigate Western sanctions. Russian companies have reportedly utilized domestically mined bitcoin for international payments, a mechanism preserved by recent legislation that maintains a ban on domestic crypto payments but allows exceptions for foreign-trade settlements. In 2022, the U.S. Treasury sanctioned BitRiver and its subsidiaries, citing their role in helping Russia monetize energy resources and potentially offset sanctions' impact.