Russia to Launch $12.3 Million Crypto Mining Farm in Coming Month
The Russian Federation is looking to launch a crypto mining facility worth over $12.3 million (900 million rubles) in the coming months. According to a report by local Russian media, RBC, this huge data processing center will be located in Buryatia, a Russian republic in eastern Siberia. Upon completion, the data center is expected to house 30,000 mining units, with an estimated total power consumption of 100 megawatts.
RBC also reports that the cryptomining project is being managed by JSC Corporation for Development of the Far East and the Arctic (KRDV), a state-affiliated company under the authority of both the Russian Ministry for the Development of the Far East and the Arctic, and the Presidential Plenipotentiary Representative of the Far East Federal district of the Russian Federation.
According to a press release from KRDV, Bitriver-B, an operational part of Russia’s largest mining company Bitriver, has begun construction of the project, and has laid some groundwork by setting up critical infrastructure and providing important power facilities. The cryptomining operation is planned to be completed in the first half of 2023, creating around 100 new jobs.
Established in 2012, the main goal of KRDV is to drive the economic and infrastructural development of the Russian Far Eastern Federal District by supporting investment projects across several fields, including tourism, energy, health, etc.
Russia to subsidize its new crypto mining project
The operating costs of the Buryatia-based mine farm are set to be heavily subsidized via various government support mechanisms used by KRDV. This grant will be in various forms, including exemption from land and property tax, reduced income tax etc.
“The Bitriver-B company, which creates one of the most important enterprises for the digital development of Buryatia, has received a wide range of state support tools. This is zero tax on land and property, insurance premiums reduced to 7.6%, and a reduced income tax rate,” said the head of KRDV Buryatia, Dmitry Khameruev.
In addition, the 100 megawatt mining station will pay only half of the electricity tariff after integration with the national power grid. This high level of government support is based on the economic status of Buryatia, which is considered a “priority development area”; therefore, these are certain incentives aimed at attracting investment from local and foreign entities.
Russia has been crypto friendly lately
After Russia invaded Ukraine in 2022, the Russian Federation has adopted a more friendly approach to the crypto industry.
The crypto market is currently valued at $966.001 billion | Source: TOTAL chart on TradingView.com.
Formerly known as an anti-crypto nation, Russia seems to have recognized the huge potential of cryptocurrency, especially as the Eastern European country is currently subject to several international economic sanctions from the EU and the US.
One of Russia’s most notable crypto-friendly moves occurred in September 2022, when the Bank of Russia announced plans to legalize the use of cryptocurrency in the settlement of cross-border transactions.
Featured image: Watcher Guru, chart from TradingView
