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Crypto miners in Russia decided to catch electricity surges

To detect cryptocurrency miners, whom the Central Bank intends to outlaw, law enforcement agencies will be involved, and the interaction of several departments is not ruled out. And miners will be identified by electricity consumption. Elizaveta Danilova, Director of the Financial Stability Department of the Bank of Russia, announced this.

The Central Bank has never hidden its negative attitude towards “money surrogates” and on January 20 in the report “Cryptocurrencies: Trends, Risks, Measures” called for a complete ban on mining in the country. How effective is the method proposed by the regulator for detecting cryptocurrency miners and whether ordinary Russians will suffer from this, experts said.

The financial regulator in the fight against cryptocurrency decided to go to the bitter end. Law enforcement agencies will fight the miners. “Tracking miners is probably possible by some activity in terms of electricity consumption,” said Elizaveta Danilova, director of the financial stability department of the Bank of Russia. “I think there are already ways to detect such activity.”

“This method is more than adequate,” says Dmitry Vereshchagin, IT director of the Rubezh group of energy companies. – There is nothing fundamentally new in it. In fact, illegal consumers of electricity are also detected. In this sense, it makes no difference whether the competent authorities identify an illegal connection or a “gray” mining farm.”

It is worth explaining what the problem is: firstly, gray mining leads to a sharp increase in energy consumption, for which, as the experience of many countries shows, generating capacities and power networks may not be ready. The reliability of power supply to ordinary consumers may suffer.

Secondly, in terms of energy consumption, a mining farm is an industrial enterprise. This means that its owners must pay for electricity not at tariffs regulated by the state for the population, but at market prices set for legal entities.

“You should not think that you are the most cunning and will deceive the state and citizens,” the expert continues. – To understand the scale of the problem, I note that bitcoin mining consumes about the same amount of electricity per year as such a large country like Argentina spends over the same period. The move of mining farms from China to Kazakhstan in the second half of last year led to an energy crisis in this country.”

The energy system of Russia, of course, is more stable than that of Kazakhstan: we have a significant reserve of generating and network capacities, but our tariffs for the population are among the lowest in the world. There are a lot of people who want to profit from this combination of factors among the “gray” miners.

According to Dmitry Vereshchagin, ordinary Russians can suffer when miners are identified only if they illegally connected to the power grid or provide excessive load, being engaged in some kind of industrial production, which is disguised as private consumption. No owners of ultra-modern game consoles or “smart houses” with a bunch of electrical appliances give such a load to the network.

“If you bought one or two video cards and mine cryptocurrency at home, then you remain a household consumer who does not cause noticeable consumption spikes,” the expert explains. But it is unprofitable to maintain small mining farms, and few people do this. The Central Bank is talking about identifying an actual industrial consumer who wants to deceive others and pretends that he is an ordinary household user.

Whether it will be possible to solve the problem of such a highly profitable business with bans and interagency cooperation alone is an open question. “The adoption of such bans will hit, first of all, large players, since they are quite easy to identify,” says Denis Smirnov, liquidity manager at EMCD. – These are the companies that have legal contracts with energy companies, import equipment according to official documents and pay taxes. Bans will definitely not solve the problem of “gray” mining.”

Even in China, where state control is disproportionately tighter, miners continue to illegally mine bitcoins after the ban: according to CNBC, underground capacities account for up to 20% of the hashrate (this is a unit of measurement for the speed of calculating the mathematical algorithm necessary to create a crypt by a digital computing device in 1 second The higher the hashrate, the more efficient the device works, that is, the more profit it brings).

Be that as it may, in the near future the state will have to decide what is more important to it: a high-tech sector that can generate high taxes and create new jobs, or another illegal zone that will take a lot of law enforcement resources to try to control, Smirnov argues. “I don’t think that the choice for officials here is so obvious,” the expert believes.

Read the material “Experts assessed the consequences of the ban on cryptocurrencies in Russia”

Source From: MK

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