Russia's largest data center operator, BitRiver, has teamed up with the Russian Direct Investment Fund (RDIF). Together, they plan to build mining and AI computing facilities across BRICS nations. They announced this partnership at the BRICS Business Forum in Moscow on October 18, 2024.
The goal? To boost Russia's presence in the global computing market. They aim to construct high-performance data centers that support cryptocurrency mining and artificial intelligence workloads.
BRICS is an economic alliance made up of Brazil, Russia, India, China, and South Africa. This group represents over 40% of the global population and about a quarter of the world's GDP. In 2024, the bloc expanded to include Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE.
BitRiver's CEO, Igor Runets, stated, “We will focus on creating a mining-based infrastructure—building data centers and connecting them to necessary power sources to enable AI project deployment and development across the country.”
Currently, BitRiver operates 21 data centers in Russia, with 10 more under construction. The RDIF, established in 2011, has invested over 2.2 trillion rubles, which is about $22.7 billion, across more than 100 projects.
The companies highlight a global shortage of energy-intensive data center capacity as a key reason for their expansion. This initiative aligns with Russia's strategy to strengthen its position as the second-largest crypto mining market in the world, following the United States.
Runets emphasized, “Mining is not just a foundation for the digital economy. As Russia catches up with the United States in mining, it means our country cannot be ignored.” He added that this growth brings economic benefits, liquidity for transactions, and creates skilled jobs nationwide.
RDIF CEO Kirill Dmitriev mentioned, “Computing power development for AI implementation remains a priority for Russia and BRICS partners.” He believes that joint use of high-tech infrastructure will help reduce costs and dependency on foreign technology.
This expansion follows Russia's new mining regulation law from August 2024. This law sets a legal framework for industrial mining operations. It requires miners and data center operators to register in a government database, report their activities, and follow regional energy consumption limits.
BitRiver's website outlines two regulatory frameworks established by these mining laws. The first covers experimental legal regimes for crypto companies in Russia. The second regulates mining and cryptocurrency operations on a national level. The Bank of Russia oversees these regulations in coordination with the Ministry of Finance, Federal Security Service, and Financial Monitoring Service.
The law mandates that commercial miners and data center operators register in a government database, report operations, and comply with energy limits. Individual miners can operate without registration if their energy use stays below specified limits. The government can restrict mining in regions with energy shortages.
Additionally, the legislation outlines guidelines for foreign partnerships and cross-border operations. It allows Russian-mined cryptocurrency to be used for international transactions. However, mining companies cannot combine their operations with electricity transmission or generation businesses. Pool operators and data center providers must identify their clients and report suspicious transactions to authorities.
The expansion of data centers aligns with the strategy of BRICS members to develop sovereign technology infrastructure. These countries are working on alternative systems to reduce reliance on Western providers while maintaining control over critical computing resources and data. According to Nathan Lewis in Forbes, Russian banks have begun to develop independent infrastructure, with Sberbank launching digital asset projects in late 2022.
Kremlin aide Yury Ushakov stated, “Creating an independent BRICS payment system is an important goal for the future, based on state-of-the-art tools like digital technologies and blockchain.”
Ryan Chow, CEO of Solv, commented, “The expansion of crypto mining by these major players signals bitcoin's growing global adoption. This opens up new opportunities for liquidity and financial inclusion in BRICS regions.”
Data from blockchain.com shows that the Bitcoin network's total hash rate reached 723.63M TH/s in October 2024. This is a significant increase from 450M TH/s year-over-year, marking a 55% growth. Daily mining revenue has stabilized around $30.78 billion, while network difficulty rose to 93.02T, up from 62T last November. This indicates a substantial deployment of new-generation mining hardware and increasing competition.
Chow concluded, “As more infrastructure is established, it has the potential to bring a wave of new participants into the Bitcoin ecosystem. This could drive greater engagement with Bitcoin finance and the broader blockchain ecosystems.”