Fun

Utility Seeks $800,000 From Russians Mining Crypto With Cheap Power

News Feed - 2022-01-27 04:01:10

Utility Seeks $800,000 From Russians Mining Crypto With Cheap Power


The main utility company in Irkutsk is looking to collect almost $800,000 from owners of crypto farms that have allegedly caused a spike in electricity consumption in the Russian region. The supplier accuses the miners of burning cheap household electricity in what is, in fact, a business activity. Power Utility Takes Crypto Miners to Court


Irkutskenergosbyt, the local power distributer in Irkutsk Oblast, has filed 137 lawsuits against customers using subsidized electricity to mint digital currencies in mining facilities set up in basements and garages. Taking the cases to court, the utility hopes to recover 63 million Russian rubles (over $790,000) in compensation, Tass reported quoting its director, Andrey Kharitonov.


The company says these home miners are engaged in entrepreneurial activities while paying for their electricity at the tariffs for the population, which are four times lower than commercial rates. The owners of the underground crypto farms are also increasing the load on the grid in residential areas leading to breakdowns and outages.


In 2021 alone, over 1,200 cases of ‘gray’ mining were identified, Kharitonov told the news agency. Of the 137 filed lawsuits, 19 claims in the amount of 21 million rubles were satisfied. All other claims are still being considered and no cases have been lost so far, he detailed.


The executive pointed out that cryptocurrency mining significantly increases the volume of consumed electrical energy in the region. While in 2020, Irkutskenergosbyt’s customers used about 7 billion kilowatt-hours (kWh), in 2021 the figure approached 8 billion kWh. At the same time, the number of private households and apartment buildings has remained almost unchanged.


The power utility has registered the highest concentration of mining farms in the Irkutsky and Shelekhovsky districts. Electricity tariffs in these rural areas are lower than those in the city of Irkutsk. At only 0.86 rubles ($0.01) per kWh, households in these parts of the region have access to the cheapest electricity in Russia while businesses have to pay 3.6 rubles per kWh.


The miners who lost in court will now have to not only cover the price difference for the power they have already consumed but also sign new contracts with Irkutskenergosbyt at commercial rates. Their region became known as the “mining capital of Russia” after a large amount of mining hardware was imported from China when Beijing launched a nationwide crackdown on the industry in May last year.


In October 2021, the governor of Irkutsk Oblast, Igor Kobzev, joined mounting calls to recognize cryptocurrency mining as a type of entrepreneurial activity and make miners pay higher electricity tariffs and taxes. In December, the federal government in Moscow allowed Russian regions to determine local electricity tariffs in residential areas.


The future of mining in Russia, among other crypto-related activities, is still undecided. A working group at the State Duma has been tasked to prepare legislation to fill the regulatory gaps remaining after the adoption of the law “On Digital Financial Assets.” Last week, the Central Bank of Russia proposed the prohibition of bitcoin mining as part of a blanket crypto ban but media reports revealed its hardline stance is not gaining support from other government institutions. Tags in this story Bitcoin, cases, compensation, Court, Crypto, crypto farms, crypto miners, crypto mining, Cryptocurrencies, Cryptocurrency, distribution company, Electricity, Energy, Irkutsk, Irkutskenergosbyt, Lawsuits, Miners, mining, oblast, power, rates, region, Russia, russian, tariffs, utility


Do you expect Russia to legalize crypto mining and introduce higher electricity rates for miners? Tell us in the comments section below. Lubomir Tassev


Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration. Kazakhstan Shuts Down Crypto Mining Farms Till February MINING | 19 hours ago US Still Dominates Bitcoin Mining Sector, 30-Day Stats Show Foundry USA Takes Top Pool Position MINING | 2 days ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleDvision Network 2nd LAND Sale to Be Held on OpenSea and Their Native Marketplace Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItJPMorgan: Ethereum Losing Ground to Other Crypto in NFT Market Due to High Transaction Fees, Congestion


JPMorgan has told its clients that ethereum is losing ground to rival cryptocurrencies, such as solana (SOL), in the non-fungible token (NFT) market due to sky-high transaction fees on the network. "It looks like, similar to defi apps, congestion and ... read more.Indian Government Needs More Time to Finalize Crypto Bill: Report UFC Partners With Dapper Labs to Launch NFT Collection "UFC Strike" Tom Brady"s Autograph NFT Agency Gets $170 Million in Series B Funding Round Report: A16z to Raise $4.5 Billion for Crypto Investments

News Feed

Didar Bekbauov1 hour agoHow Bitcoin miners can survive a hostile market — and the 2024 halvingBitcoin mining is becoming harder — which means miners will have to spend more to receive fewer rewards. But there are sti
Economics Professor Tyler Cowen Says Cryptos Useful as Hedges or Forms of Payments – ‘Not Both’
Economics Professor Tyler Cowen Says Cryptos Useful as Hedges or Forms of Payments – "Not Both" Tyler Cowen, an economist and professor at George Mason Univers
Ana Paula Pereira3 hours agoCrypto Biz: Uniswap’s Android wallet app, Cboe to launch BTC, ETH margin futures, and moreGetting regulatory approval has been crucial for companies, particularly in a tight regulatory envir
EU touts health benefits for children in the metaverse despite risks
Tristan Greene7 hours agoEU touts health benefits for children in the metaverse despite risksThe European Union’s in-house think tanks says the metaverse can help children heal from diseases.1161 Total views2 Total sha
Speculation Abounds Regarding Youtube’s Removal of Crypto Content
Speculation Abounds Regarding Youtube"s Removal of Crypto Content At least six crypto Youtube channels have reported in recent hours that their content is being removed under the
No, You Can’t Buy Shares in Bitcoin
No, You Can"t Buy Shares in Bitcoin With bitcoin going through an extended bull-run, scammers and con artists have been on hand to exploit a general fear of miss
Russian Association of Power Suppliers Proposes Measures to Prevent Home Mining
Russian Association of Power Suppliers Proposes Measures to Prevent Home Mining The industry organization of Russian energy suppliers has come up with ideas on how to combat crypto
Crypto hack losses hit $19B, Terraform Labs shuts down: Finance Redefined
Prashant Jha4 hours agoCrypto hack losses hit $19B, Terraform Labs shuts down: Finance RedefinedNearly $19 billion worth of digital assets have been lost to exploits in the past 13 years, with $2.9 billion stolen in the
Ethereum network is valued fairly, but ETH could still see 17x return — Brian Russ
Ray Salmond3 hours agoEthereum network is valued fairly, but ETH could still see 17x return — Brian RussUsing a unique quantitative approach, ETHDenver speaker Brian Russ told attendees that ETH is fairly valued but co
BRICS Nations Working on Creating New Currency to Be Discussed at Next Leaders Summit: Report
BRICS Nations Working on Creating New Currency to Be Discussed at Next Leaders Summit: Report The BRICS nations are reportedly working on developing a new form of currency, which i
Bitcoin Decline Continues: Is $86,800 The Level To Watch?
Este artículo también está disponible en español. On-chain data shows the Realized Price of the Bitcoin short-term holders lies at $86,800 right now, making the level one
Canadian Lawmaker Introduces Bill to Encourage Crypto Sector Growth
Canadian Lawmaker Introduces Bill to Encourage Crypto Sector Growth A bill has been introduced in Canada to encourage the growth of the crypto sector. “Canada should be attr