Russia Becomes World’s Second-Largest in Bitcoin Mining as U.S. Crypto Regulation Remains Uncertain

As a report has it, Russia has become the second-largest Bitcoin (BTC) miner in the world, while the United States still remains in the number one position.

According to a new report by a local news outlet Kommersant, Russia’s emergence to the second position comes amid crypto regulatory uncertainty in the United States, which could help the former in taking the top spot in the long run.

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However, the publication further stressed that just like the U.S., Russia also faces uncertainty in terms of regulating the crypto-mining industry.

The report reads in part:

“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.”

“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.”

Going by data from Bitriver, Russia’s largest mining provider, the ranking is based on the usage of power in cryptocurrency mining operations.

According to Bitriver CEO Igor Runets, the American mining industry is facing headwinds by rising electricity prices, reduced profitability, tax troubles, and over-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.”

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The Biden Administration has proposed taxes equal to 30% of the costs of electricity used in digital asset mining operations.

If approved, the tax would go into effect in 2024 and have a staggered implementation schedule with a rate of 10% in year one, 20% in year two, and 30% in year three.

At the time of writing, Bitcoin (BTC) is trading at $27,402, with a relatively 8% price downtrend in the last seven days, according to CoinMarketCap.

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