As prices of cryptocurrencies remain entrenched below support levels of $5,000, home-based miners in Russia are looking to break-even on their investments by selling their hardware to buyers interested in used crypto mining equipment. Chinese miners, the largest community engaged in generating miners are also facing similar issues and more since their government has cracked down on cryptocurrency activities via regulatory reforms.
Unable to make profits with the latest round of market correction it is the indie miners and enthusiasts who are hit the worst. One of the highest numbers of amateur miners operate in Russia since the country has one of the lowest electricity rates for retail consumers, with the average price of $0.01 per kWh.
Mining is not banned in Russia
In Russia, unlike in China, cryptocurrency markets are not regulated. The government has yet to draft its digital assets policy and currently, all references to ‘mining’ are excluded from the proposed regulatory framework. This implies that the crypto mining sector would continue to be unregulated in the near future as well.
On the other hand, it is learned that officials are more positive towards the entire cryptocurrency setup and are seeking legal protections such as preferential taxes, tax breaks for miners engaged in this industry. The apparent affinity for mining activities related to cryptocurrencies is that the miners use the easily available, low-cost energy resources to generate these virtual assets. However, digital currencies are considered as ‘money surrogates’ in Russia and are illegal tender in the former socialist republic.
Sellers rise by 25% in Sale of equipment
In the wake of low prices which are impacting the profit making abilities of these individual miners operating out of their basements and garages the number of advertisements for the sale of mining rigs has escalated by a whopping 25% in the past two weeks.
Prices of mining infrastructure including hardware have fallen substantially since the days when there was a massive demand for these currencies mining equipment. The Graphic Processing Units the most in-demand component has seen a decline in demand by over 2.5 times in recent weeks. The price of mining units which were approximately $3,500 in January is now available at nearly 37% of the prices at $2,200.
The hardship for the mining communities across the world began with prices of bitcoin falling by over 80% in comparison to high values nearly a year ago. In comparison to China, Russia has witnessed cryptocurrency industrialization at a faster rate.