Russia bans crypto mining in Moscow through 2032

Russia just pulled the plug on Bitcoin mining in its capital. Moscow, the surrounding Moscow Region and parts of Kursk are now banned from crypto mining and mining pool participation through Dec. 31, 2032, under government decree No. 936. The decree was signed July 25 and published July 31.

If you’ve been hearing about Bitcoin mining but never quite followed the details, here’s the short version: mining is the energy-hungry computing process that keeps Bitcoin’s network running. Miners use specialized hardware to verify transactions and earn cryptocurrency in return. The catch is that it requires enormous amounts of electricity, and that’s exactly what’s causing problems in Russia right now.

Mining eats 1 gigawatt in Moscow’s power system

Russia’s Energy Ministry said the year-round restriction was needed to reduce the risk of power capacity shortages. Mining currently consumes roughly 1 gigawatt in the Moscow power system. The region’s data center capacity could reach 3.6 gigawatts, or 17 percent of peak demand, by 2032, Interfax reported.

Russia is no small player in this space. The country accounted for an estimated 175 exahashes per second, or 16.4 percent of Bitcoin’s global computing power, in the first quarter, placing it second behind the United States. It’s unclear how much of that capacity was located in the newly restricted regions.