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Russian cryptocurrency mining companies are continuing to invest significantly in new initiatives, with the Bitcoin mining entity Intelion announcing a $135 million investment in AI.
The Intelion business group, recognized as one of the largest industrial mining operators in Russia, stated that it would allocate the funds for “server equipment for AI computing.”
According to the Russian media outlet RBC, the firm plans to utilize its “new capacities” as “part of” a new “data center” initiative in the Samara Oblast.
Russian Crypto Mining Firms Prepared to Invest Heavily
Intelion has indicated that to “execute” its new AI initiative, it will separate its “high-performance computing business” into a subsidiary.
This new entity will be called Intelion Cloud. It is expected to concentrate on “developing a consortium of companies in the AI sector.”
It will also “offer clients access to high-performance computing resources.”
Domestic cryptocurrency mining firms have expanded rapidly as global cryptocurrency markets have surged.
Moreover, they have established agreements with energy providers in regions of Russia characterized by cooler climates and low electricity costs.
This swift growth has led the industry to diversify into AI-related sectors. Companies have also provided Moscow with access to new data centers, anticipating that this will encourage regulators to view their industry favorably.
Moscow aims to initiate a nationwide IT development project. Crypto mining companies assert that their data centers will assist the government in achieving its objectives.
Could AI Emerge as a New Revenue Source for Crypto Miners?
Russian analysts assert that AI development will significantly increase energy consumption levels. They predict that by 2035, electricity usage in the AI sector in Russia “will reach 4.5 GW.”
Experts emphasize that “new infrastructure and advanced GPUs” are urgently required to support the growth of the domestic AI sector. Maxim Vyaznikov, the first CEO of Intelion Cloud, stated:
“Industrial crypto mining enables us to establish and sustain large-scale infrastructure designed for the future. It will also aid in recovering investments due to the high current demand for computing power.”
The company indicated that the “first phase” of its new data center in Samara is expected to become operational “in the fourth quarter of 2024.”
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Additionally, the firm announced that it would invest another $48.2 million in the construction of the data center “over the next two and a half years.”
Russia's economy is growing, but can it last? https://t.co/NPwoinkBue
— BBC News (World) (@BBCWorld) June 6, 2024
Miners Expand in Russia – and Beyond
Intelion Cloud claims it “already possesses” a variety of modern servers. These reportedly include “advanced” Nvidia A100 series graphics accelerators.
The mining entity appears eager to offer “per-second pricing” options for AI companies requiring server rentals.
RBC highlighted that the increasing demand for electricity “for the continuous operation of AI systems” was generating “additional revenue for Bitcoin miners.”
Miners in the United States have initiated similar projects, including the American mining firm Core Scientific.
Earlier this month, Core Scientific revealed a $3.5 billion, 12-year agreement with the cloud service provider CoreWeave.
Tonight, we announced that Core Scientific will be providing an additional ~200 MW of infrastructure to host @CoreWeave #HPC services.
– ~200 MW of infrastructure for HPC compute
– Estimated to generate total cumulative revenue for Core Scientific of over $3.5 billion during the… pic.twitter.com/GWRaJuJdZs— Core Scientific (@Core_Scientific) June 4, 2024
This agreement will enable the miner to supply approximately 200 MW to AI projects, reportedly yielding an average annual revenue of around $290 million.
Miners Anticipate Regulatory Progress
The industry is seeking a breakthrough with regulators as it continues to advocate for the legalization of industrial mining.
Government representatives have expressed support for initiatives that would recognize mining as a form of “entrepreneurship.”
In February, the Russian crypto mining firm BitRiver announced plans to construct a new 100 MW data center in the southern republic of Buryatia.
Many Russian cryptocurrency mining companies are strategically establishing their new data centers outside more prominent Bitcoin industry centers such as Irkutsk.
While Samara experiences hot summers, its winters are cold. The region is well-known for its oil refining and petrochemical sectors.
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