SBI Holdings, Japan’s leading financial service company, will close down its crypto mining operations in Russia, per a Bloomberg report.
A spokesman for the firm said that one of the reasons behind the move is the overall uncertainty over the prospects of the mining business in Siberia following the sanctions imposed on Russia in the wake of the invasion of Ukraine.
Earlier this year, the International Monetary Fund warned that Russia could evade economic sanctions imposed by the U.S. and other Western countries by turning to cryptocurrency mining.
The overall slump in crypto prices this year is something SBI took into consideration, too, as the Bitcoin mining business became less profitable, added the spokesman.
SBI Crypto, the conglomerate’s crypto mining subsidiary, has been mining cryptocurrencies in mining farms outside of Japan since August 2017, opening its mining pool to the general public in March 2021.
In addition to Bitcoin, the firm also mines Bitcoin Cash and Bitcoin SV.
With 2.46 EH/s of computing power, SBI’s Bitcoin mining pool is currently ranked 11th globally, providing 1.2% to the network’s overall hash rate, per BTC.com.
It is not immediately clear when exactly SBI will cease its crypto mining operations in Russia.
Before the withdrawal is completed, SBI will have to sell all its mining equipment stationed in Siberia, the spokesman for the firm said.
Bitcoin miners leave Russia
Russia, which boasts vast resources of cheap power from natural gas and hydropower dams, became a popular destination for Bitcoin miners after China’s massive crackdown on the crypto industry last year.
In April, this all changed following Russia’s invasion of Ukraine, with the U.S. Treasury Department imposing sanctions on BitRiver, a Switzerland-based mining company with multiple subsidiaries in Russia.
“By operating vast server farms that sell virtual currency mining capacity internationally, these companies help Russia monetize its natural resources,” the Treasury said at the time.
Compass Mining, an American Bitcoin hardware mining company, announced plans to sell $30 million in crypto mining equipment in Siberia, or 15% of its capacity at the time, to avoid sanctions shortly after.