Despite the crypto regulations still unclear, Russia could become the leader of sustainable crypto currency mining
Last month, Chinese President Xi Jinping said the country has ambitious plans to achieve climate neutrality by 2060, calling for a „green revolution.
If the strategy is properly implemented, it could help China finally rid itself of its status as a major polluter, significantly improving the global ecosystem. This program could also drastically disrupt the country’s famous Bitcoin Machine mining industry (BTC).
China’s best-known mining area is the southern province of Sichuan, which boasts a strong hydropower sector. However, electricity here is particularly cheap only during the rainy season from May to September. Outside this period, most of the miners migrate northward to the Xinjiang region and Inner Mongolia, which currently generate more than 40% of the total hash rate of Bitcoin. Unlike Sichuan, however, these desert areas depend mainly on non-renewable energy sources such as coal. If the government continues its program to zero carbon emissions, mining will become inefficient and local operators will have far fewer options.
The future of Bitcoin mining is green
It seems that the world has finally understood the harsh truths of climate change and carbon dioxide emissions from human activities. As a result, continued access to renewable energy will become one of the most important factors in Bitcoin mining. But are there any locations that can meet this requirement?
Let’s take a look at the Bitcoin Mining Map to study a realistic estimate of the geographic distribution of BTC’s global hash rate. China, of course, is in first position by a wide margin, responsible for more than 65%. Then we find the United States, Russia and Kazakhstan, in a head-to-head at 7.24%, 6.90% and 6.17%, respectively.
The Commonwealth of Independent States, or CIS, a region that includes Russia and Kazakhstan, seems to be particularly ignored by international operators, mainly due to lack of information about local mining sectors.
As in the northern provinces of China, Kazakhstan’s electricity is mainly produced by coal-fired power plants. It costs little but is not sustainable. In addition, the local government has interfered with the electricity market by reducing tariffs and costs, so there is a risk that they will eventually increase again.
Russia, on the contrary, has many natural prerequisites for low-cost renewable electricity, as well as a more stable economic environment.
Cold and rich in energy
If I had to find one thing the Soviet Union could do well, I would say the industrial infrastructure.
Most of Bitcoin mining in Russia takes place in the famous Siberian region, which has also been an important area for aluminum production since the 1960s. Since aluminium production processes require electricity at every stage, the USSR decided to build Siberian smelters together with hydroelectric power plants (Russia hosts up to 9% of the global water resources, mainly in Siberia and the country’s most eastern region).
Aluminium smelting technology has evolved since then, making production much more energy efficient. This, together with the fact that the Soviet government often left room for future growth in infrastructure construction, is the main reason why the region has so much excess energy today. According to RusHydro, the world’s second largest hydropower producer, the total installed capacity of hydropower plants in Siberia is currently estimated at about 45 million kilowatts. More precisely, estimates indicate that hydroelectric power plants in Siberia produce almost 10 percent of the total output of all power plants controlled by the Unified National Energy Network.
Another key element is Siberia’s climate, nine months of cold weather a year. If there is one thing that can benefit from this condition, it is hosting a data center full of ASIC units at full capacity. Anyone who has tried to use a mining device at home during the summer months will know what I am talking about.
China is an ally
Russia’s proximity to China is also a great advantage, as the best mining hardware is produced in the country.
Historically, Moscow has had a solid economic relationship with Beijing, which continues to strengthen even today. Shipments between the two countries are cheap, fast and steady. Freight trains and planes