Russia begins operating a crypto mining center worth over $12.3 million – Cryptopolitan
The Russian Federation plans to start operating a cryptocurrency mining facility worth $12.3 million (900 million rubles) in the coming months. According to a report by local Russian media, RBC, this huge data processing facility will be located in Buryatia, a Russian republic in eastern Siberia.
The data center is expected to contain 30,000 mining units when completed, using an estimated 100 megawatts of power in total.
JSC Corporation for Development of the Far East and the Arctic (KRDV), is a state-affiliated enterprise that operates under the supervision of both the Russian Ministry for Development of the Far East and the Arctic and the Presidential Plenipotentiary Representative in the Far East. The Eastern Federal District of Russia manages the cryptocurrency mining project, according to RBC.
Bitriver-B, the operating arm of Bitriver, the largest mining company in Russia, has reportedly started construction of the project and laid some groundwork by establishing crucial infrastructure and providing necessary power facilities, according to a press release from KRDV. In the first half of 2023, the crypto mining operation is expected to be completed, adding approximately 100 new jobs.
KRDV was founded in 2012 with the primary goal of promoting investment projects in a variety of industries, including tourism, energy, health and others, to promote economic and infrastructure development in the Russian Far Eastern Federal District.
The government plans to support the crypto mining center
KRDV plans to largely subsidize the operating costs of the Buryatia-based mining farm through a number of different government support programs. This assistance will take many forms, for example reduced income tax rates, exemption from land and property tax, etc.
According to Dmitry Khameruev, the head of KRDV Buryatia,
“Bitriver-B company has gained access to a wide range of government support instruments, helping it establish one of the most important enterprises for Buryatia’s digital development. In addition, insurance rates have been lowered to 7.6%, and the income tax rate has been lowered.”
In addition, after being integrated into the national power grid, the 100 megawatt mining station will only be required to pay half of the electricity tariff. These significant levels of government aid are based on Buryatia’s economic status as a “priority development area”, and they serve as incentives to attract domestic and international investors.
The Russian Federation has changed its stance on cryptocurrency since it invaded Ukraine in 2022.
Russia’s crypto-friendly initiative
Despite having a reputation for being anti-crypto, Russia today seems to see digital currency’s huge potential, especially given that the EU and US have several banking sanctions in place against the Eastern European nation.
When the Bank of Russia revealed plans to allow the use of cryptocurrencies to settle cross-border transactions in September 2022, it was one of Russia’s most prominent crypto-friendly initiatives.
