In a dramatic shift in the global landscape of cryptocurrency mining, Russia has surged ahead to become the world’s second-largest bitcoin (BTC) mining hub, with the US maintaining its position as the leader.
This development has significant implications for investors, businesses, and enthusiasts worldwide as the crypto market evolves rapidly.
From underdog to powerhouse
According to the Russian news outlet Kommersant, BitRiver, a company that provides colocation services for cryptocurrency mining operations, has reported that the Russian Federation has now achieved the second position globally regarding mining power.
With 1 gigawatt (GW) of power involved in mining, Russia has reportedly surpassed Kazakhstan and the US in bitcoin and cryptocurrency mining. The US, however, remains the leader with a mining capacity of 3-4 GW.
Following the US and Russia are Gulf countries with 700 MW, Canada with 400 MW, Malaysia with 300 MW, Argentina with 135 MW, Iceland with 120 MW, Paraguay with 100-125 MW, Kazakhstan with 100 MW, and Ireland with 90 MW.
Russia’s crypto mining boom
In January 2022, Russia ranked fifth. This meteoric rise is attributed to the restrictions imposed on mining activities in Kazakhstan and China due to electricity shortages.
Experts believe that the new legislation will provide a sense of security for mining industry players to plan their operational and financial activities, execute major projects, draw investments, and advance related sectors of the Russian economy, specifically the electric power and information technology industries.
The impact on the US and beyond
The lack of clear regulations regarding cryptocurrencies in the US may lead to a potential market distribution shift, opening the door for Russia to overtake the US in the mining race.
The rising electricity prices and the abolition of tax incentives in the US may also contribute to a slowdown in the country’s mining capacity growth.
As the global crypto market evolves, investors, businesses, and enthusiasts must keep a close eye on the shifting landscape of bitcoin mining.
Russia’s rapid ascent to second place in the bitcoin mining world showcases the industry’s dynamic nature. It highlights the importance of regulatory clarity and favorable conditions for the continued growth of the crypto market.