Russia has taken a major step towards establishing its position in the crypto sector, especially after realizing that it is buried in fines from other countries, especially as a punishment for waging war with Ukraine. Russian authorities are currently accelerating the process of bridging the legal loopholes associated with cryptocurrency mining and aim to legalize the process. Cryptocurrency mining is the task of generating cryptocurrencies by unraveling complex proof-of-work algorithms on advanced computers.
Russia’s Deputy Minister of Energy Evgeny Grabchak agreed to “eliminate the legal gap” and regulate cryptocurrency mining at the first national conference of legitimate cryptocurrency miners in the Irkutsk region of Russia.
“The legal gap makes it difficult to regulate this area and set clear rules for the game. If you want to do something about this activity and you have no other choice in the current reality, Legal regulations need to be introduced and the following concepts need to be added: mining into the regulatory framework. “
Crypto mining procedures are notorious for consuming large amounts of electricity and disrupting the local power supply.
Several parts of the world, including the town of Svaneti in China, Kazakhstan and Georgia, are dysfunctional due to power shortages caused by cryptocurrency mining.
About 60% of Bitcoin mining activities are powered by fossil fuels. Even Elon Musk has expressed concern about cryptocurrency mining, which drives increased fossil fuel use.
For the sake of clarity, I strongly believe in the code, but it cannot promote the use of fossil fuels, especially the significant increase in coal.
— Elon Musk (@elonmusk) May 13, 2021
Regarding Russia, Grabchak states that it is imperative to identify suitable mining sites in the country and manage electricity, especially with cryptocurrency mining requirements in mind at the regional level.
In January of this year, Russian President Vladimir Putin said the country had advantages in mining cryptocurrencies.
“Here we also have certain competitive advantages, especially in the so-called mining industry, which means surplus electricity and well-trained personnel available in the country,” said the 69-year-old Russian President at the time. ..
At present, it is unclear when Russia will adjust crypto-related legislation to benefit its mining operations.
Cryptocurrency mining has accelerated in other countries like Iran, Kazakhstan, and Russia after China banned cryptocurrency activity last year.
For example, several residents of the Irkutsk region of eastern Russia have set up illegal cryptocurrency mining centers in their homes, garages and even balconies. This phenomenon is called “gray mining”.
According to Russia’s Irkutsk ElectricGrid Company (IESC), electricity consumption in the region increased by 108% last year.
Local managers reportedly attacked the Irkutsk area and found 1,100 gray mines where people illegally installed cryptocurrency mining systems in their homes and garages.
Finding alternatives to enhance cryptocurrency mining operations, perhaps from renewable resources, has emerged as a common solution from industry experts to analyze the situation.
Recently, five industry experts gave testimony in front of the US House of Representatives Energy Commercial Oversight Subcommittee. All five recommended the adoption of more environmentally friendly energy to enhance cryptocurrency mining.
In some areas, crypto mining has already taken proactive steps to tackle this problem in an efficient way.
El Salvador President Nayib Bukele reveals plans to build Bitcoin City at the foot of Conchagua volcano to power Bitcoin mining with renewable energy and tackle process-related carbon footprint issues Did.
Miami Mayor Francis Suarez also proposed to set up a Bitcoin mining facility near the Florida nuclear power plant. Nuclear power is on the verge of being recognized as a true environmental, social and corporate governance (ESG) solution from an energy perspective, according to the latest News Today report.
Bitcoin mining accounted for 0.8% of the world’s total carbon dioxide (CO2) emissions in a year. This is recently claimed by a new study by the research platform CoinShares.