Japanese financial giant SBI Holdings has partially suspended cryptocurrency mining in Russia due to geopolitical uncertainty and the crypto winter.
SBI Holdings has suspended mining operations in Russia’s crypto-rich region of Siberia, citing reasons including the conflict between Russia and Ukraine and the ongoing bear market.reported Bloomberg on Thursday.
The Japanese online brokerage closed Siberian mining operations shortly after Russia launched a military intervention in Ukraine on February 24, a spokesman for the firm said.
The termination contributed to SBI’s crypto asset business reporting a pre-tax loss of 9.7 billion yen ($71 million) in the second quarter of 2022. As a result, the Sumitomo Mitsui Financial Group-backed group posted 2.4 billion yen ($17.5 million) in net loss, reportedly posting its first quarterly loss in a decade.
Reports on SBI mining suspensions in Siberia correspond with public mining information from SBI’s cryptocurrency mining affiliate SBI Crypto. According to data from blockchain explorer BTC.com, SBI Crypto’s mining hash rate plummeted around 40%, going from 5,600 petahashes per second (PH/S) in mid-February to 3,300 PH/S on August 18. of 2022.
After closing some mining operations in Siberia, SBI is reportedly still carrying out some mining activities in Russia, according to Bloomberg. SBI CFO Hideyuki Katsuchi reportedly revealed the company’s plan to sell cryptocurrency mining hardware and fully withdraw from the country earlier this week.
SBI has not yet decided when it will complete the withdrawal from Siberia, according to an SBI spokesman. The company does not have any other cryptocurrency business in Russia, and plans to continue operating its Moscow-based commercial banking unit, SBI Bank.
As previously reported, Russia emerged as one of the world’s largest cryptocurrency mining countries last year, becoming the third largest BTC hash rate producer after the United States and Kazakhstan. The country quickly lost its hash rate lead when China returned to the top three mining nations in early 2022, while many miners chose to avoid operations in Russia due to geopolitical uncertainty.
In April 2022, the US Department of the Treasury imposed sanctions on BitRiver, Russia’s largest cryptocurrency data center provider, which had been involved in major imports of cryptocurrency mining devices from other countries. Some US mining companies, such as Compass Mining, later tried to liquidate $30 million worth of cryptocurrency mining hardware in Siberia to avoid sanctions.
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