Russian Crypto Mining Firms Ready to Spend Big
Russian crypto mining companies are heavily investing in new ventures. Intelion, a major Bitcoin mining player, has announced a $135 million investment in AI technology. The Intelion business group, one of Russia’s largest industrial mining operators, plans to spend the money on “server equipment for AI computing.”
According to the Russian media outlet RBC, Intelion will use its “new capacities” for a “data center” project in the Samara Oblast. This region is known for its oil refining and petrochemical industries.
Miners Branch out in Russia – and Beyond
To support its AI initiative, Intelion will create a subsidiary named Intelion Cloud. This new firm will focus on “developing a group of companies in the AI field.” Additionally, it will provide clients with “high-performance computing power.” Domestic crypto mining companies are expanding quickly due to the booming global crypto markets. Furthermore, they have secured deals with energy providers in cooler regions of Russia, benefiting from low electricity fees.
This rapid expansion into AI-related industries has led to new data centers. Moscow has been offered access to these centers, hoping to influence regulators to favor the crypto mining industry. The government aims to launch a nationwide IT development project.
Could AI Become a New Money Spinner for Crypto Miners?
Russian experts predict a significant rise in energy consumption due to AI development. By 2035, they estimate that the AI sector’s electricity consumption will reach 4.5 GW. This growth necessitates new infrastructure and advanced GPUs to support the domestic AI field. Maxim Vyaznikov, the inaugural CEO of Intelion Cloud, stated that industrial crypto mining allows for the creation and maintenance of large-scale infrastructure designed for future needs. This will help recoup investments due to the high demand for computing power.
Intelion plans to bring the “first phase” of its new Samara data center online by the fourth quarter of 2024. Moreover, an additional $48.2 million will be invested in the data center’s construction over the next two and a half years.
Miners Hope for Regulatory Breakthrough
Intelion Cloud already boasts a range of modern servers, including advanced Nvidia A100 series graphics accelerators. The company aims to offer “per-second pricing” options for AI firms renting servers. Increasing demand for electricity to power AI systems is creating additional income opportunities for Bitcoin miners.
Similar projects are underway in the United States. For instance, mining firm Core Scientific recently announced a $3.5 billion, 12-year agreement with cloud service provider CoreWeave. This deal will see Core Scientific provide around 200 MW of infrastructure to AI projects, potentially generating an average annual income of $290 million.
Miners Branch out in Russia – and Beyond
The sector is hopeful for regulatory advancements that would recognize industrial mining as a form of “entrepreneurship.” In February, the Russian crypto mining firm BitRiver revealed plans to build a new 100 MW data center in Buryatia, a southern republic. Many Russian crypto mining companies are strategically building new data centers outside traditional Bitcoin industry hubs like Irkutsk. Despite Samara’s hot summers, its cold winters make it a suitable location for such ventures.
Overall, Russian crypto mining firms are making significant strides in the AI sector. By investing heavily in infrastructure and forming strategic partnerships, they aim to position themselves at the forefront of both industries.
