Russian Bitcoin (BTC) mining companies continue to operate as normal despite the military’s incursion into Ukraine in the last week.
Based on estimations taken from research from the Cambridge Bitcoin Electricity Consumption index which was released in August, miners from Russia made up around 11.2 percent of the worldwide BTC hash rate at August 2021. Since sanctions against the Russian government being imposed by those in the U.S. and allied NATO countries, it’s not clear which way the local BTC sector as well as the overall market could be affected.
Although some mining companies like Ethereum specifically Flexpool have shut down the services they offer in Russia as a response to the influence, BTC miners Compass Mining has assured customers who are hosting in Russia that their mining infrastructure would be operational within the region.
Compass Mining CEO Whit Gibbs offered his condolences and thoughts to those who are affected by the war, via Twitter in the early hours of today. he reminded people that their mining facilities within Eastern Europe are located safely in Serbia far from any “geopolitical tensions.”
We want to assure those of our customers who reside in Russia that we’re always in touch with the mining facilities that are located located in Siberia as well as well-protected from any political turmoil. Compass has assured our suppliers that the miners are safe and are functioning as normal.
— Whit Gibbs (@BitcoinBroski)
The 24th of February, 2022
The Biden administration announced the following day that they would put in place “sweeping financial sanctions” and strict export control” on Russia’s most prominent banks, government top officials, as well as the tech industry.
It is interesting to note that the severe limitations aren’t yet extended to the global payments network SWIFT or even cryptocurrency transactions. Some observers have suggested that this might be the time when the Russian cryptocurrency market grows as it may quickly become a significant device to avoid different sanctions.
In an email for investors, earlier in the day BTC bulls as well as Morgan Creek digital co-founder Anthony Pompliano pointed out the possibility that the Russian government may make use of this opportunity to move away from an US dollars reserve and return to a decentralized currency that has a worldwide appeal
“This game theory is what leads the way to Bitcoin. Another option for becoming the creator and distributer of the reserve currency worldwide could be being the highest-level owner and user of a worldwide reserve currency which is not controlled by any one nation.”
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“That motive is the reason these powers to recognize the fact that Bitcoin will become a major factor in years to come. States with significant ownership stake in Bitcoin and also conduct mining or other bitcoin-related activities in their respective countries is going to enjoy a huge advantage” said the official.
VanEck’s chief of digital asset research Matthew Sigel echoed similar sentiments to Bloomberg and noted that Bitcoin’s Bitcoin network can help Russia to lessen the risk of negative effects of being shut out from in the Western financial system
“Neither people who are dictators, nor human rights advocates will have to deal with any kind of censorship through this network.” Bitcoin blockchain.”