SBI Holdings Inc has announced plans to shut and withdraw cryptocurrency mining operations from Siberia, Russia.
Japan’s largest online brokerage said that the Russian invasion of Ukraine, a neighbor state, has created uncertainty brought on by reams of US-led sanctions against the Kremlin.
Because of this, and the most recent crypto market rout, the business is now more profitable and its future – precarious.
As a result, SBI Holdings CFO Hideyuki Katsuchi has confirmed that the company is now actively seeking to sell its equipment and withdraw its own participation in cryptocurrency mining.
Investors have often seen Siberia and Russia in general as a good place to establish cryptocurrency mining – a power-hungry business that was, until February, benefiting from cheap natural gas and hydropower dams.
While cryptocurrency companies remained outside the scope of sanctions, everything changed in April when the US Treasury Department struck out against BitRiver, a Switzerland-based company, which had been operating in Russia. Taking notice, other companies began to withdraw.
However, SBI Holdings had halted mining preemptively, soon after the war started. This has cost the business $72m in the three months ended on June 30.
The company has said that it has so far had no bids for its equipment and the exact date of withdrawal will depend on being able to offload the equipment – no mining is being done in the meantime.
Meanwhile, the International Monetary Fund has warned that cryptocurrency mining could help the sanctioned Russian regime to find a way around economic sanctions.
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