Russia’s miners buy more BTC mining rigs in Q4, report
Bitcoin and the entire crypto market is bleeding due to many challenges that have hit the industry. From the Terra crash and continuous rate hikes to the FTX implosion, the market hasn’t had a full month of positive price trend.
While investors are crying foul over the loss of investment funds, Bitcoin miners are struggling to stay afloat. As a result, the BTC price has continued to plummet even with the rising electricity costs of miners’ operations. But surprisingly, many miners in Russia want to buy mining rigs now.
Why Are Russian Miners Buying Bitcoin Mining Rigs?
According to Kommersant’s recent report, many miners in Russia are grabbing more Bitcoin rigs in Q4 of 2022. In addition, the researchers discovered that sales of ASIC rigs skyrocketed at the end of the year. This is surprising given the continuous fall of crypto assets in the market.
On closer inspection, it became clear that Russian miners are benefiting from cheaper electricity costs. In addition, the country provided more affordable electricity to many regions, making it easier for households and businesses in those places to flourish. So while other miners in countries with high electricity costs are struggling, their Russian counterparts have it more accessible.
Another reason to collect several ASIC crypto mining rigs is because of the cheap offer for the equipment. As a result, ASIC prices in the country fell, spurring many miners to acquire more.
Another reason that led to this increase in mining rig purchases was the growing interest in crypto mining as a viable investment opportunity. According to Xive’s co-founder Didar Bekbauovbitcoin mining became attractive due to less investment opportunities, sanctions and the high-tech qualifications of many people in the country.
The buying spree started after the Ministry of Finance of the Russian Federation (MiFin) and the Bank of Russia (BoR) agreed to support crypto mining. But they allowed it in regions with multiple energy allocations, not those with scarce energy supplies.
Second, Russian regulators introduced a bill to legalize mining and the sale of mined assets in the country. This bill came up in the Russian State Duma, the lower house of parliament.
Financial analyst Vladislav Antony also stated that the lower price of ASIC mining rigs, which are now close to production costs, is a good encouragement for new investors. Mining revenues in Russia have increased recently, even with the BTC price registering a near two-year low.
Sales report for suppliers of mining rigs
One of the distributors of mining rigs in Russia, Chikot, recorded more sales in October and November. This was different from their Q3 records.
Data shows that Chikot sales in Q1 to 3 were higher than sales in 2021 by 65%. In August and October 2022, the price of hardware fell by almost 20% and remained the same in the following months.
As a result, Chikot even recorded a 30% increase in mining rig purchases in one transaction, different from the records in early 2022.
Featured image from Pixabay, chart from TradingView.com
