Bitcoin Mining Farms Are Flourishing on the Ruins of Soviet Industry in Siberia

The favorable energy prices and naturally cold climate are turning Siberia into an international mining hub with miners from Europe, Asia and the U.S. placing their rigs in local farms.

Built during the Cold War to power Soviet manufacturing, the Bratsk hydroelectric station in Eastern Siberia is now fueling another energy-hungry industry: bitcoin mining.

Several large mining farms have set up shop in Bratsk, an industrial city on the bank of the Angara River, taking advantage of the region's low temperatures, which keeps cooling costs down, and the hydro plant's abundant, inexpensive electricity.

As a result, bitcoin mining farms across Russia now wield a joint capacity of 600 megawatts, accounting for almost 10 percent of the total 7 gigawatts of power supporting the bitcoin network worldwide, said Ozersky, a former banker and top manager at the Russian state corporation Rusnano.

By comparison, farms in China, widely regarded as the world's mining capital, account for around 60 percent of the total network hashpower, according to the recent report by Coinshares.

My accidental driver, Ivan Kaap, is the head of security at a large mining facility in Bratsk called Bitriver, but we're visiting his company's smaller competitor, Minery.

Sam Chi, president of Landmark Entertainment Asia, which is mining bitcoin to fund its operations, points at two containers where his own ASICs reside.

Pablo Lobo of Sthorm, a company which mines bitcoin to fund a research lab, gave another explanation: Siberia's climate makes it a no-brainer for choosing a mining host, providing natural cooling for most of the year.

Then the number of miners will ultimately grow almost four times, Ushakov told CoinDesk: before the end of this year, another building in the former factory, of a similar size, will be turned into a mining data center as well.

Ivan Kaap at Bitriver's mining farm in Bratsk, photo by Anna Baydakova for CoinDesk.