Japanese financial holding SBI to stop cryptocurrency mining in Russia

The company intends to sell off all of its mining equipment

19.08.2022 - 08:55

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2 min

What’s new? Representatives of Japan’s largest online broker SBI Holdings Inc. said that they will shut cryptocurrency mining operations in Russia and sell off all equipment. The company noted that the geopolitical situation has created uncertainty regarding the development of mining in Siberia. In this, the fall of the crypto market has made it not as profitable as before, Bloomberg reports.

Information on the Bloomberg website

How did events develop? Russia attracted miners with cheap electricity from natural gas and hydropower plants. These advantages made the territory of the Russian Federation popular on par with North America after Beijing’s 2021 ban on cryptocurrency mining forced miners to leave China.

According to an SBI spokesman, the company suspended mining in Siberia shortly after February 24. This resulted in a loss of 9,7 billion yen (about $72 million). Bloomberg noted that it was the company’s first unprofitable quarter in 10 years. The company’s representative said that SBI has not yet decided when it will complete its exit from the business in Siberia. Herewith, he added that the company intends to continue to operate its Moscow commercial banking unit, SBI Bank LLC.

Which companies have been affected by sanctions? In April, the US Treasury Department imposed sanctions against BitRiver, a mining center operator. Its purpose was to block the company’s operations in the States because of its activities in Russia. Shortly thereafter, US mining company Compass Mining Inc. announced that it would sell its equipment located in Siberia to avoid sanctions.

What is known about SBI? It is a Japanese group of financial services companies. It was founded in 1999 and was originally called SoftBank Investment. In April 2011, SBI went public on the Hong Kong Stock Exchange. In June of the same year, the group bought 50% of Russia’s Obibank (United Investment Bank). In 2018, together with the British fintech company Wirex, it launched Visa bitcoin cards in the Japanese market.

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