Russian President Vladimir Putin has issued a warning about the potential power shortages that could arise from crypto mining activities in the country. During a meeting on July 17, Putin highlighted the significant electricity consumption of Bitcoin and other crypto mining facilities, which is already causing shortages in regions such as the Irkutsk region, Buryatia, and Trans-Baikal Territory.
Putin described the issue as “acute and fraught with serious consequences” for enterprises, residential areas, and social facilities, potentially impacting investment and infrastructure projects. He noted that crypto mining in Russia currently consumes 16 billion kilowatt-hours annually, representing 1.5% of the country’s total electrical consumption, with usage on the rise due to low electricity prices and the ease of moving mining equipment.
In response to the growing concerns, Russian lawmakers are set to discuss draft legislation that would only permit approved companies to engage in large-scale crypto mining operations, while allowing the government to ban mining in regions experiencing energy shortages. Additionally, a draft bill has been approved to decriminalize crypto mining in Russia while banning crypto from circulation, as the country’s current laws prohibit crypto settlements but not circulation.
In addition to addressing the challenges posed by crypto mining, Putin also called for the expansion of Russia’s central bank digital currency (CBDC), the digital rouble. He emphasized the success of the digital rouble pilot program, which has seen over 27,000 transfers and 7,000 payments for goods and services, involving 12 banks, 600 individuals, and 22 trade and service enterprises across 11 cities.
The extension of the CBDC pilot program aligns with previous reports suggesting that Russia could begin using its digital rouble domestically in the second half of 2025 following testing for domestic transactions. The central bank launched the pilot program in August 2023, with plans for wider implementation in the future. Putin’s call for the expansion of the digital rouble comes as part of a broader effort to address the challenges and opportunities presented by the growing crypto industry in Russia.
