Russia Poised to Capture 18% of Bitcoin Hashrate Amid Major Crypto Miners’ Migration, Experts Predict

Russian analysts predict that the cryptocurrency mining industry could experience a second major migration due to the increasing regulatory pressures, taxation, and energy costs in countries such as the United States and Kazakhstan. They suggest that in such a scenario, Russia may have the potential to capture up to 18% of the global bitcoin hashrate.

Some of the DeFi barriers:

-Friction and cost of fiat<->crypto
-Complexity & entry barriers for new users
-Complex & increasing regulatory pressures on projects
-Lack of convertibility for use in everyday TX@ScallopOfficial fixes this as $SCLP is a true TradFi<->DeFi bridge pic.twitter.com/11Q2NAV2IW

— Defi Warrior (@defi_warrior9) April 18, 2023

Russian analysts suggest that due to increasing regulatory pressures, tax duties, and energy prices in countries like the United States and Kazakhstan, cryptocurrency miners may be looking for a new location. Russia, according to these analysts, has the potential to attract up to 18% of the worldwide bitcoin hashrate, potentially even half of Kazakhstan’s cryptocurrency miners.

Will Russia Become a Leading Destination for Cryptocurrency Miners?

Currently, Russia accounts for about 4.7% of worldwide hashrate, ranking fifth among important mining targets. However, the tightening of regulations towards the sector in leading countries may result in another mass relocation of miners, similar to the one that occurred following China’s crackdown on the sector in 2021.

The Intelion team believes that new rules on access to low-cost energy, as well as rising electricity rates and higher taxes, may result in the relocation of up to 6% of mining capacity from the United States, Canada, and China, as well as around half of the miners from Kazakhstan, to Russia.

With low electricity costs, free capacity reserves, and developed energy infrastructure in many locations, Russia has the potential to change the current global crypto-mining market order.

If if if if all im saying is it changes how and when to engage. Is it that hard to grasp its worth being a little more cautious if there's even a slight chance Russia goes nuclear? Like I understand Russia bad but every action has consequence

— Matt (@Spirits_Undead) March 5, 2022

According to Semyonov, Russian enterprises are making increased efforts to expand their operations, and the industry has received government support.

Although the mining regulation bill has yet to be passed by parliament, official statements from Moscow suggest that Russian leaders plan to capitalize on the country’s “competitive advantages” as a mining hotspot, as stated by President Putin.

Intelion experts argue that mining in Russia needs to become a “legal business activity with clear rules of the game” in order to create a favorable investment climate.

They predict that the “just beginning” banking crisis in the United States and Europe will drive up demand for bitcoin as a hedging tool and increase interest in crypto among formal financial organizations, resulting in a rise in global mining importance.