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The suspension would go from December 1 to March 2025, and would last until 2031.
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In the past, Mining companies have provided heat to residences and industries.
The Russian government announced on November 19, 2024 its plans to ban Bitcoin (BTC) mining during the winter in some regions of the country and at sites taken in Ukraine.
The provision, adopted by a government commission led by Russian Deputy Prime Minister Alexander Novak, seeks to limit the Bitcoin mining and cryptocurrencies for prioritize energy flow in heating of homes.
The ban would take place in Irkutsk, Buryatia and Zabaikal, three regions within Siberia, a huge territory of extreme climate in Russia. In addition, this measure would affect six regions of the North Caucasus, southeast of Russia, as well as the occupied Ukrainian regions of Donetsk, Luhansk, Zaporizhia and Kherson.
What do those regions included in the possible ban have in common? energy shortageaccording to the releaseand temperatures that in winter fluctuate from -10° to -30° (with the exception of Zaporizhia and Kherson, which is normally from 0° to -5° in this season).
During winter, temperatures in the city of Irkutsk can reach -30°. Fountain: Wikipedia.
Mining in Siberia would be suspended from December 1, 2024 to March 15, 2025, with annual restrictions from November 15, 2025 to March 15, 2031.
While in the case of the regions in the North Caucasus and those occupied in Ukraine, the bans would be total from December 2024 to March 2031, without seasonal suspensions, according to reported a local medium.
This news was known a few days after Putin announced the legalization of BTC mining and cryptocurrencies, which came into effect on November 1, 2024, as reported by CriptoNoticias.
How does Bitcoin mining consumption affect an energy-poor region?
According to Russia’s deputy chief executive, in 5 to 10 years the electricity shortage in Russia could be serious. The energy consumption of Bitcoin mining in a region facing energy shortages, especially during the winter when heating is essential, can generate tensions in the energy supply, as reported by CriptoNoticias.
Bitcoin mining requires large amounts of energy to operate the required equipment and its maintenance, which can aggravate the demand on an already overloaded electrical grid during the cold months.
In regions with limited supply, mining can compete directly with residential and industrial consumers for energy access. This could result in power outages or insufficient supply.
So if Bitcoin mining consumes a significant portion of the available energy, Electricity rates may increase for domestic and commercial consumers.
Thus, mining could be perceived as a non-essential activity (along with the satisfaction of basic needs) that displaces energy resources, generating social discontent and demands for government intervention. Although Putin says that bitcoin mining is goodthere are more immediate problems to address in Russia.
Bitcoin miners were used to heat homes in the past
In contrast to the Russian provisions, although the energy consumption of Bitcoin mining may be problematic, there are also ways in which it can be positively integrated into the energy system.
In some cases, waste heat generated by mining equipment can be reused for heating in residential or industrial spaces, helping to mitigate the shortage of energy for heating.
For example, as reported CriptoNoticias, MARA Holdings, a leading company in the sector, announced in June 2024 the launch of a pilot test to use waste heat to heat an entire town of 11 thousand inhabitants in Satakunta, in Finland, northern Europe.
Here it would be prudent to mention that this is a region of smaller size and population density than, for example, Irkutsk, which has more than 640,000 inhabitantswhich would make the transport of that heat more difficult.
Coinciding with the provisions of MARA, Jaran Mellerud, co-founder of Hashlabs, a Bitcoin mining company, explained in April 2024 his project to heat homes and communities in Finland through the heat emitted by Bitcoin mining equipment.
According to added Mellerud, its intention is to reduce the use of energy to heat homes from sources such as natural gas, oil and other non-sustainable sources.
In summary, and despite the examples presented, the ban on Bitcoin mining in the aforementioned regions of Russia during the winter highlights the importance of balancing technological innovation with energy stability and the basic needs of populations.
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