Russia Takes Second Place in Mining Cryptocurrencies: Report

According to a new report from Russian news outlet Kommersant, Russia has jumped to second place in the world’s cryptocurrency mining operations, outranking all other countries except the United States.

The ranking is based on the amount of power used to mine digital assets. The data was taken from Bitriver, Russia’s largest mining provider.

“Russia has risen to second place in the world in cryptocurrency mining. The United States remains the leader. However, the uncertainty in the regulation of cryptocurrencies there may trigger a new redistribution of the market.”

Russia’s rise in the mining industry is accompanied by regulatory uncertainty in the US that could soon shake up the rankings. Additionally, Russia’s crypto and mining industries remain subject to regulatory uncertainty.

“However, in Russia, in general, the legal framework for miners has not yet been developed, experts emphasize. In addition, sanctions risks are growing both in relation to Russian players and their counter-parties abroad.”

The American mining industry is also facing a multitude of issues, such as rising electricity costs, decreased profitability, tax problems, and overly leveraged mining businesses.

“In addition, the vast majority of equipment was purchased by American miners on credit, so many over-leveraged companies are in the process of bankruptcy or have already gone bankrupt.”

The Biden Administration has proposed a tax equalling 30% of the costs for electricity used in digital asset mining operations. This tax would be implemented in three stages, with 10% in the first year, 20% in the second and 30% in the third.

Bitcoin’s price at the time this article was written is $27.353, down by 1.1% from yesterday.

Featured Image: Shutterstock/whitehoune