Russian Advisers Recommend Crypto Mining Ban In Residential Areas: Report

Currently, activities pertaining to cryptocurrency and its trading remain unregulated in Russia.

Advisers to the Russian government have recommended a ban on crypto mining in residential areas of the country. The main purpose of the suggested ban is to prevent fires in residential buildings and homes. The banning suggestion comes amid the ongoing issue of blaming unprofessional miners for causing high loads on the grid, which result in breakouts and blackouts. Advisers in the Energy Committee of the State Council have suggested that going ahead with the decision of the proposed ban will significantly reduce fire hazards in the country. It is an advisory body that reports to the office of the Russian president.

According to a report by Bitcoin.com, the aim is to restrict the complete production of cryptocurrencies in apartment blocks and houses in Russia. The ban could also remain limited to some areas of the country that are experiencing high energy outages and shortages. These include regions like Moscow and the Moscow Oblast.

Currently, cryptocurrency and its trading activities in the country are unregulated. This is especially a major issue in regions that have access to cheaper electricity. Meanwhile, a bill related to crypto mining is already under review in the Russian parliament, the Duma.

Energy experts have also stated that the country's federal government should empower local governments to levy taxes on cryptocurrency and mining in the industry, according to Bitcoin.com, citing a Russian daily, Izvestia. This was discussed in a committee meeting that took place in December last year.

Anton Tkachev, who is a member of the State Duma Committee on Information Policy, Information Technologies and Communication, is of the opinion that imposing a ban on mining in regions that are energy-deficient would be the right thing to do. He added that a massive amount of energy continues to be consumed by industrial mining farms at present.

Tkachev stressed that the issue of energy security is an acute problem in smaller towns that do not have an adequate budget to spend on the repair and maintenance of energy-related infrastructure. The lawmaker also stated that there is a higher risk of mining in private residences because the equipment can cause fires.

Meanwhile, the Russian Ministry of Energy has announced its support for the legislation needed to regulate crypto mining in the country. The ministry has acknowledged that Russia's distribution networks are not properly designed to handle power overloads in the residential areas. And this is happening primarily due to coin minting in different households.

Currently, Irkutsk Oblast is the hub for home mining of crypto in Russia. This is due to some of the lowest electricity rates in the country, which is subsidised for the citizens in this region. People have been reportedly establishing crypto farms in basements and garages in Irkutsk Oblast. 

During the first half of last year, multiple crypto mining hardware systems were found in over 23 fire locations in Russia.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.