Russia has banned cryptocurrency mining in several regions of Siberia to avoid winter power cuts and restricted it in regions of Ukraine it has declared annexed, a government commission said Tuesday .

The ban will be enforced during the winter months in three regions near Lake Baikal, where cryptocurrency mining has thrived in recent years due to the low cost of electricity, mainly produced by large hydroelectric plants.

In annexed areas of Ukraine, much energy infrastructure has been destroyed since Russia sent its forces in 2022, leading to electricity shortages.

According to official estimates, cryptocurrency mining in Russia consumes 16 billion kilowatt hours per year, or about 1.5% of the country’s electricity consumption, creating challenges for regions with harsh climates. Alongside the United States, China, Kazakhstan and Canada, Russia is a world leader in cryptocurrency mining. This year, Russia enacted a new law regulating the activity and introduced taxes, hoping to collect up to 200 billion rubles ($2 billion) a year from miners.