Kremlin official warns rising crypto mining could strain Russia’s energy supply

Russia could face energy shortages in the next 10 years due to the rapid expansion of Bitcoin mining, a Kremlin official has warned.

A senior Kremlin official warned that Russia could face energy shortages in the next 5-10 years due to the rapid expansion of crypto mining, according to Russia’s state news agency TASS.

Maxim Oreshkin, deputy head of the presidential administration, expressed concern about the potential pressure on Russia’s energy supply, noting that regions such as southern Siberia are already experiencing capacity problems due to increased crypto mining activity.

Oreshkin said that although Russia does not have an overall energy usage problem, some parts of the grid are experiencing energy shortages due to increasing power demands from Bitcoin mining. Southern Siberia, a popular region for crypto mining due to low electricity costs, has seen significant pressure on its energy infrastructure as mining activities intensify.

Russia is approaching potential energy deficit

Addressing Russia’s energy future, Oreshkin hinted that the country may need to reconsider its approach to capacity development to ensure that new energy facilities are developed at competitive costs.

“The question is whether we can create energy capacity at a price that will remain competitive for mining under the new conditions.”

Maxim Oreshkin

The warning comes as energy-intensive operations of crypto mining continue to expand in Russia, taking advantage of cheap power supplies.

In early October, BitRiver, a sanctioned crypto mining company, expressed confidence in Russia’s potential to overtake the United States in Bitcoin mining by 2027. BitRiver CEO Igor Runets emphasized that the country’s crypto mining growth rate has matched that of the United States in recent years, and that rate has been contracting. energy consumption gap.

Runets emphasized that the evolving regulatory environment is encouraging oil and gas companies to re-evaluate their strategies and encouraging cooperation with Russian crypto miners.

Although Russia has signaled a positive stance towards crypto mining, challenges to the crypto business remain. As crypto.news reported, Russia will soon ban Bitcoin mining in many regions due to critical electricity shortages. According to Russian Deputy Minister of Energy Evgeny Grabchak, regions such as the Far East, southwestern Siberia and the South are currently experiencing significant energy deficits, making it impossible to provide large energy capacities until at least 2030.