Russian Billionaire Interested in Industrial Scale Bitcoin Mining

News and Analysis

According to Forbes sources, Suleiman Kerimov, CEO of Nafta Moscow, is considering launching a massive cryptocurrency-related project.

“I heard Kerimov was interested in mining bitcoins on a massive scale. He has had several meetings with the world’s biggest manufacturer of mining processors, BitFury,” one of bitcoin entrepreneurs told the Forbes.

Another source insists the main obstacle on Kerimov’s way was Russian red tape.

“Kerimov was talking with numerous government entities, but then it all stopped,” said one of bitcoin market players.

Nafta Moscow or Bitfury did not comment the information.

According to George Basiladze, co-founder of Cryptopay, billionaire Yuri Milner and Lev Leviev, co-founder of Russian social network VK, also attempted to invest in bitcoin before Kerimov.

“The interest for bitcoin didn’t fade away, though there’s not as much excitement as before. Now there are big serious players, like R3, a banking consortium,” Basiladze said.

According to Forbes, Suleiman Kerimov has made a career of investing in distressed companies. He started a diversified investment company, Nafta Moskva, in 1992. Just before the country’s financial meltdown in 2008, he sold nearly all of his Russian assets, including shares in Gazprom, government-owned Sberbank and a massive housing development in suburban Moscow. Kerimov borrowed heavily to buy stakes in Morgan Stanley, Goldman Sachs, Deutsche Bank and others.

He soon lost billions, but began investing again in the Russian market with the help of loans from VTB Bank. He bought a stake in Polyus Gold, the nation’s largest gold mining outfit; Rostelecom, a leading telecom company; and billionaire Dmitry Rybolovlev’s stake in Uralkali.

In August 2013, Kerimov, then CEO of Uralkali, was arrested by Belarusian law enforcements accused of
abusing his power and embezzling funds, while his company was involved in a trading alliance with Belaruskali, a government-owned fertilizer company. The authorities said the companies could resume their relationship if Kerimov got rid of his stake, so he sold it to billionaires Mikhail Prokhorov and Dmitry Mazepin.

By early 2015, he had sold substantially all of his other assets except the stake in Polyus Gold, which he bought out after borrowing $5.5 billion.

A native of Dagestan, Kerimov represents the republic in Russia’s Federation Council. To get around a 2013 law barring politicians from holding bank accounts and other financial assets abroad, he pledged his assets to a Swiss charity, the Suleyman Kerimov Foundation, but Forbes assumes he retains ownership.

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