Fearing Sanctions, U.S. Crypto Miner Seeks Hasty Exit From Russia

 Fearing Sanctions, U.S. Crypto Miner Seeks Hasty Exit From Russia

U.S. crypto miner Compass Mining is looking to quickly divest its equipment in Siberia after the United States cracked down on its partner BitRiver over its Russian operations.

In an announcement on Discord, CEO Whit Gibbs said the firm is required to immediately cease all dealings with BitRiver, its Russian hosting partner. The firm will immediately wind down its Russian operations, and is looking to liquidate the hardware.

Compass wants quick exit from Russia

The firm said that it would seek to liquidate all of its equipment in Russia, and share the proceeds with clients who own the equipment. Gibbs told Bloomberg in an interview that the firm expects to recover most of the $30 million it has invested in the country.

Compass also appears to have scrubbed all instances of its Russian operations from its website. The firm said it will now focus chiefly on its North American operations.

While we have always advised that hosting outside of North America comes with additional risk, this is a terrible turn of events to put it mildly.

-Compass CEO Whit Gibbs

The move comes after the U.S. Treasury imposed sanctions against Swiss crypto miner BitRiver, one of Europe’s biggest hash rate providers.  The Treasury, in its first ever crackdown against a mining firm, said the move was spurred by BitRiver’s numerous Russian entities.

U.S. officials also fear that Russia could use crypto to bypass recent sanctions, although experts opine it is highly unlikely.

Russia leans into crypto mining

Russia appears to be leaning further into crypto adoption and mining, in the face of dire economic prospects bought about by the sanctions. The country’s vast energy resources and cold climate make it an optimal environment to mine crypto.

Prior to the Ukraine conflict, Russia was poised to become the next big mining hub, after majors China and Kazakhstan banned the industry.

But it remains unclear how Russia will further its mining prospects, given that sanctions by the United States and its allies have effectively blocked key technology exports to the country.

With more than five years of experience covering global financial markets, Ambar intends to leverage this knowledge towards the rapidly expanding world of crypto and DeFi. His interest lies chiefly in finding how geopolitical developments can impact crypto markets, and what that could mean for your bitcoin holdings. When he isn’t trawling through the web for the latest breaking news, you can find him playing videogames or watching Seinfeld reruns.
You can reach him at [email protected]

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

Source link

Related post

Receive the latest news

Subscribe To Our Crypto Newsletter

Stay informed with our curated information and offers just for subscribers.