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Now, large-scale Bitcoin mining farms have set up a "base" in Bratsk, an industrial city on the Angara River. They use the region's perennial low temperatures to reduce the cost of cooling mining equipment, while also enjoying the abundant and cheap electricity resources of hydropower stations. Bratsk is a typical example. After the collapse of the Soviet Union, many military industrial departments of this once important city of the Soviet Empire were eliminated in the emerging market economy of China, and many factories had to be closed, and even a lot of ruins appeared. But now, the local area has rejuvenated its "second spring" and turned into a new city full of flowers and fertile soil - and this is inseparable from the support of Bitcoin miners.
Above: Bratsk Hydroelectric Power Station (Source: coindesk, photography by Anna Baydakova)
Dmitry Ozersky, CEO of Eletro.Farm, a Bitcoin mining farm that has built a large mining infrastructure in Kazakhstan, said:
"Over time, as some former Soviet plants closed, energy consumption in Bratsk has become more efficient overall, as Russia has a lot of excess electricity supply."
Ozersky, a former banker and current senior manager of the Russian state-owned enterprise Rusnano, said that according to the business data analysis of ASIC chip manufacturers, Bitcoin mines across Russia currently have 600 megawatts of power resources, accounting for 10% of the total energy consumption of the global Bitcoin network. Not only that, Ozersky believes that if some "old miners" with lower productivity are eliminated, this proportion may rise to 20%. Of course, Chinese mines still dominate the Bitcoin mining network. According to the latest analysis report by Coinshares, the computing power owned by Chinese mines accounts for 60% of the total computing power of the Bitcoin network.
However, Siberia still has a rich heavy industrial heritage, and many abandoned factories still retain factory buildings, land and power infrastructure. Miners can make full use of these resources and build the region into an international mining center.
“Transnational Mining Container”
In the quiet suburbs of Bratsk, it is difficult for ordinary people to find the specific location of the Bitcoin mine. There are no company logos on the concrete and metal gates, and only authorized guests with appointments can enter.
It is in this area that many cryptocurrency mining farms, large and small, are located, such as the large mining Bitriver and its smaller competitor Minery. Minery's mining machines are deployed in 26 financial containers, the equipment inside is humming, and there are many rotating fans outside to dissipate heat (as shown below):
Entrepreneurs from China, South Korea, Japan, the United States and Brazil have come to Bratsk to visit local mining facilities. Sam Chi, president of Landmark Entertainment Asia, revealed that he has chosen to deploy ASIC miners in two containers to mine Bitcoin because he values the security provided by Minery.
Sthorm is a research laboratory that is funded by Bitcoin mining. Pablo Lobo from Sthorm Lab said that the climate in Siberia is one of the reasons why many mines are willing to come here, because they do not need to invest too much in cooling equipment, and the local cold environment can naturally cool down the mining machines. Pablo Lobo revealed that Sthorm has not yet deployed ASIC mining machines in Minery, but is considering it as an option.
The average temperature in Bratsk is about 0 degrees Fahrenheit in winter and about 77 degrees Fahrenheit in summer. The warm season lasts about four to five months each year, and the average annual temperature is 28 degrees Fahrenheit. The local mining farm's customers mainly come from the United States, Russia, South Korea, India, Japan and Spain. It is reported that a South Korean mining company has shipped more than 550 ASIC mining machines, which can produce 0.5 BTC a day, currently worth about $5,000.
“Countless mining machines are roaring”
Bitriver security guard Ivan Kaap, a former police officer, revealed that three armed guards equipped with automatic rifles, a camera and two patrol officers were deployed around Bitriver's mining farm. Below: Ivan Kaap at the Bitriver mining farm in Bratsk.
According to information disclosed by Bitriver Chief Business Officer Dmitri Ushakov, the company has currently deployed 18,000 ASIC miners, and the owners are mainly from Russia and the United States. Among them, Russians have deployed about 9,000 ASIC miners, Americans have deployed about 4,000 ASIC miners, followed by the Japanese, who own about 3,000 ASIC miners. Other customers are from Brazil, Lithuania, India, Poland and China.
Ivan Kapp claimed that Bitriver has one or two new customers every week. Now they have only deployed half of the mining equipment on the 70-yard long, three-story stairs and corridor, but it may be filled with new mining machines in the next two weeks. Not only that, the company will start building another rack of the same size in October. Dmitri Ushakov revealed that another building will be turned into a mining data center by the end of this year, and the number of its mining machines will be nearly quadrupled.
Above: Technicians are inspecting ASIC miners at the Bitriver mining farm.
The miners roared like airplane engines, exhaling hot air, and tiny lights flashed on the equipment. Uniformed technicians wearing noise-reducing helmets stood in the corridor on the second floor to check the miners, with wires as thick as their arms lying on the floor. Ivan Kaap explained that when all the construction work is completed, they will deploy industrial fans in the mine, and all the miners will be maintained and repaired on site, because their engineers have been certified by Bitmain in Shenzhen.
In addition to Bitriver and Minery, another local mining farm worth noting in Butskets is Cryptoreactor, which has a mining site with a power resource of 40 megawatts. The company has acquired the building of an abandoned local factory, which previously produced various industrial products. After trying many transformations, it finally decided to provide the factory building to Bitcoin miners.
Fedor Egorov, CEO of Cryptoreactor, said:
“For the past five years, the factory had been stagnant, with business declining more and more each year, until 2017 when the owner decided to develop the site in a different way. Currently, the site is hosting customers’ ASIC mining machines and has so far consumed only 15 MW of the 40 MW power resource, which Cryptoreactor plans to expand to 63 MW in the future.”
Siberia welcomes miners
Siberia's electricity is mainly generated by hydropower, which is one of the cheapest sources of electricity in the world, at only 4 cents per kilowatt-hour, lower than the average electricity price of 7-8 cents in Russia. Cryptocurrency currently has no legal status in Russia and is therefore not subject to taxation or securities regulation. On the other hand, operating data centers is also a traditional business in the local area, and Bitriver has also received official recognition in Bratsk. In May this year, the company signed an agreement with the Bratsk Municipal Government, pledging to invest $7.5 million in the construction of a local data center. They also sponsored a veterinary clinic and promised to recruit interns from Bratsk State University.
On August 19, Bratsk Mayor Sergey Serebrennikov visited Bitriver and issued a statement in which he expressed the Bratsk City Government’s willingness to help Bitriver at every step of its development:
“The mine is a completely new component of Bratsk’s economy and business. For us, this project is very interesting and will provide new jobs and a lot of tax revenue for the city.”
Not only that, the local power generation company in Bratsk is also friendly to miners. Timofey Benedyuk, strategic director of the power company Irkutskenergo, said that by shutting down some old and inefficient electric boiler rooms, they are now able to provide about 500 megawatts of electricity and are beginning to turn to serving new technology companies, including Bitcoin miners.
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