- Crypto ‘plays a significant role in Russian economy,’ expert claims
- Bitcoin mining is an ‘undervalued export sector,’ says Oreshkin
- Russian firms have invested $1.3b in crypto mining infrastructure
A leading aide to Russian President Vladimir Putin says crypto should be included in the country’s balance of payments calculations, and has called crypto mining an “undervalued export sector.”
Balance of payments are quarterly or yearly statistical records of economic transactions between a country’s residents and corporations and overseas nations. In Russia, the central bank’s statistics department compiles and publishes these figures, which are often used to calculate the health of a country’s economy.
But Maxim Oreshkin, the Deputy Chief of Staff of the Presidential Executive Office, said that crypto is “not taken into account in existing calculations, because settlements made in crypto take place outside conventional channels,” the Russian newspaper Vedomosti reported.
“Cryptocurrency is a form of money supply,” Oreshkin said. “[Russian firms] can and do pay for imports with cryptocurrency, and this also impacts the [fiat] currency market,”
As the Russian government’s crypto pivot continues, Moscow is facing pressure to legitimise a sector it once viewed with great suspicion.
Russia’s rapidly growing crypto mining industry
Oreshkin also spoke in glowing terms about the country’s fast-growing crypto mining sector, the Russian media outlet RBC reported.
“Russia has recently acquired a new and undervalued export item: cryptocurrency mining,” he said. “We are already talking about significant amounts. Essentially, it is a hidden export.”
The fact that Russian firms now use crypto to pay cross-border for goods and make money selling the tokens they mine means crypto “must be accounted for in Russia’s balance of payments,” Oreshkin said, as crypto “supplies affect the foreign exchange market.”
Per data compiled by the US-based Bitcoin mining firm Luxor Technology, Russia accounts for almost 16% of the world’s Bitcoin hashrate. That’s a figure only bettered by the United States.
Putin appointed Oreshkin, the country’s former Minister for Economic Development, as his top economic adviser in January 2020.
Oleg Ogienko, the CEO of the Moscow-based blockchain consultant Via Numeri, told Vedomosti that crypto mining “already plays a significant role in Russia’s economy.”
He said Russian crypto mining firms were on course to mine “tens of thousands of Bitcoin tokens this year.”
Halving takes its toll
Sergey Bezdelov, the head of the Industrial Mining Association, an industry group for Russian crypto miners, said that domestic firms mined 55,000 Bitcoin in 2023 and 35,000 Bitcoin in 2024. He said that the drop was caused by the Bitcoin halving event of April 2024.
And Mikhail Brezhnev, the co-founder of the Russian mining firm 51ASIC, told the same outlet that crypto mining revenues in the country are worth “roughly $12.9 million per day.”
And Ogienko added that the value of Russian companies’ combined investment in data centers, grid connections, power generation, and mining hardware to date “may reach and even exceed $1.3 billion.”
A top Russian politician last year claimed that domestic firms have already used crypto to conduct billions of dollars’ worth of cross-border trade in a bid to evade US, EU, and UK sanctions.
In recent months, Moscow has attempted to bring this crypto-powered trade sector under its regulatory umbrella.
In late October, the central bank and the Ministry of Finance agreed to legalize cryptocurrency payments as a recognized form of “foreign economic activity.”
The bank also operates what it calls an experimental legal regime: an official sandbox for firms that want to use crypto as a cross-border payment tool. Moscow says that the sandbox’s operations are kept confidential to protect its members from sanctions.
Tim Alper is a news correspondent at DL News. Got a tip? Email at tdalper@dlnews.com.
