Dagestan Government Chief Asks Moscow to Let it Ban Crypto Mining

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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November 18, 2024 10:00 EST

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The Russian Republic of Dagestan has asked the federal government to let it ban crypto mining under newly introduced rules.

Per MKRU and a Telegram post from the Dagestan government’s executive office, Sergey Melikov, the Head of the Republic of Dagestan, has launched an “appeal to the federal authorities.”

Melikov made “a request to ban mining activities in Dagestan” until “the situation in the electric grid complex stabilizes,” the office explained.

Will Dagestan Ban Crypto Mining?

The office claimed that in “recent years,” energy providers had “recorded a sharp increase in energy consumption in Dagestan.” It added:

“The rapid and uncontrolled development of cryptocurrency mining in Dagestan has become a […] negative factor. Mining farms lead to an even greater shortage of electricity. This affects the quality and reliability of electricity supply to Dagestan-based consumers.”

The office said that the “load increase” was a “difficult test for the regional electric grid complex, the wear and tear of which exceeds average nationwide indicators.”

It added that the upshot of all this was, “among other things,” “power outages in the homes of Dagestanis.”

Central Government to Consider Request

Melikov’s office said that a “ban on this type of activity” could only “be ordered” by a “special” central government “decision.”

As such, he asked Moscow to “take into account the peculiarities of the region.”

The regional head also wants to “ban mining in Dagestan until the situation in the republic’s electric grid complex improves.”

Melikov is likely to receive a swift response to his request. The Ministry of Energy is set to unveil a number of regional crypto mining ban orders on November 18.

State media outlets report that Dagestan is likely to be among the regions named in the ministry’s list.

Announcement Expected on Nov. 18

Furthermore, Melikov claimed that the rise in energy usage in Dagestan was “due to various factors,” including the “growing economy.”

He claimed that investment projects, construction, a rise in agricultural production, and other factors had seen electricity consumption in the republic rise “by almost 8%.”

He said that “over the past three years, this figure has approached the 26% mark.” Energy usage has risen yet higher in the winter months, he concluded.

The republic has also been working with Rosseti, the Russian power company, on solutions “aimed at increasing the reliability of the region’s power supply.”

However, Dagestan officials say these measures “are not yet enough” to compensate for “accelerated development.”