Russia could prohibit bitcoin mining in large residential spaces like apartments and high-rise flats if one prominent government-backed organization had its way. According to a report by Russia Today, Russian authorities will discuss the possibility of banning bitcoin mining farms in residential complexes during an…
Russia could prohibit bitcoin mining in large residential spaces like apartments and high-rise flats if one prominent government-backed organization had its way.
According to a report by Russia Today, Russian authorities will discuss the possibility of banning bitcoin mining farms in residential complexes during an upcoming meeting of the Presidential Council on the Internet.
Spearheading the effort is Ilya Massukh, president of the Information Democracy Foundation, a government-affiliated non-profit that manages, among other things, the federal government’s online platform for citizen petitions.
Massukh, who is also reportedly a member of the internet council under the President, will propose the ban by arguing that electricity resources at residential flats are inadequate for mining cryptocurrency. He also claimed mining activity is a fire hazard due to the heat generated by the mining hardware.
In an interview with the publication, Massukh stated:
Electric networks at blocks of flats are unlikely to stand such consumption; ventilation systems are not able to handle the generated heat, either. This could trigger a fire.
Talk of such a ban comes at a time when Russia’s finance ministry is also looking to keep bitcoin away from public adoption by planning regulations that could allow “only qualified investors to buy and sell” bitcoin via
Massukh was also skeptical of bitcoin mining in a country that continues to flip–flop over the legality of mining and adopting cryptocurrencies. It was only last year when Russia’s Ministry of Finance, the country’s financial regulator, drafted a bill to enforce criminal penalties on bitcoin adopters and miners with prison imprisonment up to 7 years.
“[B]itcoin itself is not allowed inside the country,” Massukh added. “Accordingly, the mined bitcoins go to some external exchanges. All that remains in the country is the waste of electricity [to show for mining], which is questionable in providing any efficiency for the Russian economy.
The report, citing a ‘mining consultant’, suggests that installing a mining farm in a residential apartment will increase electricity consumption by 6x-8x.
While Russian authorities deliberate over a law to ban bitcoin mining farms among everyday Russian citizens, Russian President Vladimir Putin’s internet ombudsman is attempting to raise as much as $100 million in an initial coin offering (ICO) to fund a large-scale bitcoin mining project in Russia. Electricity costs are cheaper in the country, compared to China which hosts a majority of the world’s bitcoin mining might.
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Last modified: January 24, 2020 11:59 PM UTC