New data projections concerning the total number of hash rates in the world are pointing to a visible change in the pattern. These projections entail that the total number of mining machines and activity has started to increase in Russian Federation.
While Russia has started to emerge as the new center for cryptocurrency miners, the USA is on its way to losing its ranking as the top nation in the world to account for the biggest hash rate contribution. The changes in the mining sector will directly impact the price and traction around cryptocurrencies such as Bitcoin.
These statistics have been published by Kommersant, it is a local media outlet hailing from Russia. The report has suggested that with the recent increase in mining activities, the nation has overtaken the second-biggest Bitcoin mining contributor in the world from the USA.
These statistics have come at a time when the regulatory environment in the USA is rapidly changing tides and it can be led to further shake-ups in its current rank as the top mining contributor.
US Retains Top Spot in Crypto Mining
The report published by Kommersant has maintained that Russia has managed to become the second-largest crypto-mining hub in the world. On the flip side, the USA has maintained its position as the biggest contributor to mining activities.
Regardless of these recent changes, crypto analysts claim that there are regulatory forces available in the market that can lead to a complete redistribution of this sector on an international scale.
The article has noted that Russia is not going to be impervious to the regulatory issues taking place in crypto just like the USA. The Russian government and financial regulators may change their stance towards mining laws before the dust settles down.
At present, the Russia government has not completed the legislative charter for the crypto sector and miners. Thus, crypto entities operating out of Russia may still have to deal with sanctions imposed by the West that will shape their crypto industry development.
The Russian news has used data projections from Bitriver to support their arguments about the rising power of Bitcoin mining in the region. Igor Runets the CEO of Bitriver claimed that at present the mining sector of the USA is facing some big challenges such as increasing power input prices, reduction of profits, heavy taxation, and an over-leveraged mining sector.
It also entails that a massive amount of mining equipment was acquired by American miners on credit.
Most companies in America are currently over-leveraged that have remained operational in the USA. It means that the crypto interest and participation of America has reduced significantly leading to new bankruptcy filings.
Meanwhile, the Biden administration has also decided to levy a 30% tax on crypto-mining entities for electricity usage. This new proposal will finalize in 2024 and has a 10% compliance rate for the first year of its introduction.
At the same time, this compliance rate will keep increasing to 20% and 30% in the second and third consecutive years. At press time, Bitcoin prices are trending around $27K and experienced a drop of 1.1% in market value during the last 24 hours.