The US Department of the Treasury has imposed sanctions on cryptomining company BitRiver, targeting one of the industry’s largest data-center service providers over its operations in Russia in its first such action.
The Switzerland-based firm offers energy sources, mining facilities and large-scale management solutions to bitcoin miners around the world, including those in eastern Europe and Russia. Such regions have been among one of the most popular destinations besides North America for miners that were forced out of China due to Beijing’s cryptomining ban in May last year.
The Treasury’s action comes just a day after the IMF said in a report that cryptocurrency mining could offer a pathway for countries, such as Russia and Iran, to bypass sanctions by putting natural resources that they are unable to export toward energy-intensive mining operations, such as bitcoin mining.
The Treasury on Wednesday echoed those concerns in a statement announcing the restrictions on BitRiver, including 10 of its Russia-based subsidiaries, as the war in Ukraine is set to enter a third month.
“By operating vast server farms that sell virtual currency mining capacity internationally, these companies help Russia monetize its natural resources,” the department said. “However, mining companies rely on imported computer equipment and fiat payments, which makes them vulnerable to sanctions.”
Bitcoin mining last year generated an average monthly revenue of about US$1.4 billion, of which about 11 percent might have gone to Russian miners, the IMF said.
BitRiver has not responded to a request for comment.
The sanctions on BitRiver could have an impact beyond the cryptomining industry in Russia by potentially redistributing and reducing the computing power for bitcoin mining around the globe, said Roman Zabuga, chief marketing officer at Hamburg-based BWC, a data-center operator for cryptominers.
If the computing power from the sanctioned businesses is disrupted, it would leave fewer places for miners to turn to for hosting their operations. The nearest mining facilities are in Kazakhstan, which has its own issues, while the US and Canada do not have readily available data centers and Europe is expensive, Zabuga said.
Meanwhile, miners that are not involved with BitRiver could potentially earn more bitcoin with the same computing input, or hash rate, because the difficulty of mining bitcoin would drop due to less competition from BitRiver’s miner clients.
This could set up a repeat of what happened after Beijing’s ban on cryptomining, which resulted in a sharp drop in global computing power and a multibillion-dollar windfall for miners in North America.
Elon Musk’s lieutenants have reached out to chip industry suppliers, including Applied Materials Inc, Tokyo Electron Ltd and Lam Research Corp, for his envisioned Terafab, early steps in an audacious and likely arduous attempt to break into the production of cutting-edge chips. Staff working for the joint venture between Tesla Inc and Space Exploration Technologies Corp (SpaceX) have sought price quotes and delivery times for an array of chipmaking gear, people familiar with the matter said. In past weeks, they’ve contacted makers of photomasks, substrates, etchers, depositors, cleaning devices, testers and other tools, according to the people, who asked not to
The EU and US are nearing an agreement to coordinate on producing and securing critical minerals, part of a push to break reliance on Chinese supplies. The potential deal would create incentives, such as minimum prices, that could advantage non-Chinese suppliers, according to a draft of an “action plan” seen by Bloomberg. The EU and US would also cooperate on standards, investments and joint projects, as well as coordinate on any supply disruptions by countries like China. The two sides are additionally seeking other “like-minded partners” to join a multicountry accord to help create these new critical mineral supply chains, which feed into
Japan approved ￥631.5 billion (US$3.97 billion) in additional subsidies to hasten Rapidus Corp’s entry into the high-stakes artificial intelligence (AI) chipmaking arena, ramping up support for a project widely regarded as a long shot. The capital is intended to bankroll Rapidus’ work for information technology firm Fujitsu Ltd, one of the initial customers that Tokyo hopes would get the signature endeavor off the ground. The new money raises the fees and investments that the government is injecting into the start-up to ￥2.6 trillion by the end of the current fiscal year to March next year, the Japanese Ministry of Economy, Trade and
The founder of Chinese property giant Evergrande Group (恆大集團) has pleaded guilty to charges of fraud and bribery, a court said yesterday, the latest blow for what was once the country’s leading developer. Evergrande’s rise was propelled by decades of rapid urbanization and rising living standards, but in 2020, its access to credit dramatically narrowed when the government introduced curbs on excessive borrowing and speculation. The company defaulted in 2021 after struggling to repay creditors. Founder Xu Jiayin (許家印), 67, known as Hui Ka Yan in Cantonese, was reportedly held by police in 2023, with Evergrande saying he had been subjected to
RSS