The Russian Government has issued a decree prohibiting cryptocurrency mining operations in the Republic of Dagestan effective until April 1, 2031. This decision was taken in response to concerns about excessive electricity consumption and the overloading of local power grids.

A special government commission subsequently added Dagestan to a list of other regions where mining activities were banned. The ban on mining in Dagestan will remain in place until 2031, ensuring the maintenance of energy balance in the region.

Such restrictions are currently in place in nine other regions across the country, a list of which has been compiled and approved by the Electricity Industry Development Commission under the Government of the Russian Federation. The initiative for these measures originated from the head of the region, Sergei Melikov, due to a significant increase in energy consumption in the region — by 8% in 2024. The outdated power grids have proved unable to cope with such an increase in demand, leading to numerous blackouts.

Previously, it was reported that mining operations in Dagestan were illegally consuming electricity worth RUB 400 million over a three-year period. In response, Dagestan plans to construct two new substations aimed at providing additional power to the city of Makhachkala.