Russian Regions to Develop Large Scale Crypto Mining

Two Russian Regions to Develop Large Scale Crypto Mining

The governors of two Russian regions have indicated their readiness to accommodate large crypto mining facilities. Two of the westernmost subjects of the Federation – Kaliningrad and Leningrad – are willing to welcome miners and want to get involved in “bitcoin production”. Local authorities have expressed intentions to take mining out of garages and scale it up to industrial level. They are now pressing Moscow for regulations.   

Also Read: Russia Ready for Migrant Bitcoin Miners Influx

One Huge Mining Farm

Many are interested in cryptocurrencies in Kaliningrad Oblast, its governor Anton Alihanov said on the sidelines of the Russian Investment Forum in Sochi. In the future, the region may become one huge mining farm, he told RIA Novosti.

“We have a lot of people that show interest [in crypto mining]. But doing everything right is pretty complicated and you don’t want to set the house on fire,” Alihanov said. “That’s why we have a ‘mining hotel’, where guys know how to set up the cooling systems, so that nothing gets burned”, the official added, demonstrating technical knowledge of the subject.

If you are a miner, you’ve come to the right place. We can become one huge mining farm.

Russian Regions to Develop Large Scale Crypto MiningAlihanov also noted that Kaliningrad Oblast has developed a booming greenhouse sector producing tons of strawberries. Greenhouses need heating during colder months and mining hardware produces a lot of heat. Mining farms can actually be built close to the strawberry fields to heat the greenhouses.

Still wary of buying cryptocurrencies, the governor admitted he had some “rich experience” with stock trading in the past. “Stocks, bonds, futures – these are very risky things. I don’t have funds that I am ready to part with at any moment. For now I keep my distance,” Anton Alihanov said. He added, however, that when crypto markets become more stable, he may have a second thought.

Miners to Use a Decommissioned NPP

Other local officials have also announced intentions to conduct mining business in their regions. Authorities in Leningrad Oblast, bordering the federal city of Saint Petersburg, plan to create a tech park for cryptocurrency miners. It will be built on the premises of the nuclear power plant in Sosnovy Bor, governor Alexandr Drozdenko revealed. The Leningrad Atomic Electro-Station (LAES, or LNPP) will be decommissioned in 2020-2021.

Russian Regions to Develop Large Scale Crypto MiningA new power plant will replace the RBMK units at LAES, which now produces about 50% of the region’s electricity. LAES-2 will be equipped with the safer, “post-Fukushima” WWER-1200 reactors. LAES is the largest electricity generating facility in Russia’s northwest.

The economic department of the Leningrad administration and Rosatom have already approved the project to mine cryptos at LAES, Drozdenko told RIA Novosti. “What we need for mining is cheap electrical energy, cooling system and reliable transmission grid. We have all that at the Leningrad NPP,” he said.

Russians are mining in their garages. We want to do it on an industrial scale.

According to the governor, two outstanding issues postpone the realization of the project. “First – we have to wait until the old equipment is removed [after the decommissioning]. Secondly, we need some regulatory framework that would allow us to mine, to produce bitcoin,” Alexandr Drozdenko explained. He added that “serious negotiations” on regulation are underway between his administration and the federal government.

With cheap energy, developed electrical infrastructure and cool climate, Russia has what it takes to accommodate local cryptocurrency miners and welcome foreign investors. Authorities in regions with great potential to develop the sector are impatient and expect new regulations from Moscow as soon as possible.

Do you think the government in Moscow will listen to regional authorities and adopt legislation with incentives for crypto miners? Tell us in the comments section below.

Images courtesy of Shutterstock. 

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