Bitcoin and the entire crypto market are bleeding due to the many challenges that have befallen the industry. From the Terra crash and continued interest rate hikes to the FTX implosion, the market hasn’t seen an entire month of positive price trending.
As investors mourn the loss of investment funds, Bitcoin miners struggle to stay afloat. As a result, the price of BTC continued to fall even with rising electricity costs for miner operations. But, surprisingly, many miners in Russia will now buy mining rigs.
Why Are Russian Miners Buying Bitcoin Mining Rigs?
According to Kommersant’s recent report, many miners in Russia are snapping up more Bitcoin rigs in the fourth quarter of 2022. Additionally, researchers found that the sale of ASIC rigs skyrocketed by the end of the quarter. ‘year. This is surprising given the continued fall of crypto assets in the market.
On closer inspection, it became clear that Russian miners are benefiting from cheaper electricity costs. In addition, the country has provided more affordable electricity to many regions, which has made it easier for households and businesses in these places to thrive. So while other miners in countries where the cost of electricity is high, their Russian counterparts have it more accessible.
Another reason to gather more ASIC crypto mining rigs is the cheap supply for equipment. As a result, ASIC prices have plummeted in the country, prompting many miners to act to acquire more.
Another reason that led to this increase in mining rig purchases was the growing interest in crypto mining as a viable investment opportunity. According to the co-founder of Xive Didar Bekbauovbitcoin mining has become attractive due to lesser investment opportunities, sanctions, and high-tech qualifications of many people in the country.
The buying spree started after the Ministry of Finance of the Russian Federation (MiFin) and the Bank of Russia (BoR) agreed to support crypto mining. But they allowed it in regions with more energy allocations, not those where energy supply is scarce.
Second, Russian regulators introduced a bill to legalize mining and the sale of mining assets in the country. This bill was presented to the Russian State Duma, the lower parliament.
In addition, financial analyst Vladislav Antony said that the drop in the price of ASIC mining rigs, which is now close to production costs, is a good encouragement for new investors. Mining revenue in Russia has recently been on the rise, even though the price of BTC hit an almost two-year low.
Mining Rig Vendor Sales Report
One of the mining rig distributors in Russia, Chikot, saw more sales in October and November. This was different from their third quarter records.
Data shows that Chikot’s Q1 to Q3 sales were 65% higher than 2021 sales. In August and October 2022, the price of hardware fell nearly 20% and remained the same for the following months.
As a result, Chikot even recorded a 30% increase in mining rig purchases in a single transaction, different from the records of early 2022.
Featured image from Pixabay, chart from TradingView.com
