The Russian government is preparing to introduce criminal liability for illegal cryptocurrency mining, stepping up its efforts to bring the sector under official regulation and reduce its strain on the national power grid. This move is part of a broader campaign to curb unauthorized crypto operations, especially those that rely on stolen electricity.

According to Deputy Prime Minister Alexander Novak, Moscow is pushing forward a comprehensive legal framework to regulate the circulation of digital currencies, introduce administrative penalties for minor breaches, and enforce criminal prosecution for unauthorized mining activities. These reforms are expected to form the backbone of Russia’s strategy to fully regulate digital asset usage in the national economy by next year.

In addition, the government will tighten penalties for illegal consumer lending, a domain often tied to crypto-related fraud.

A push to combat money laundering

As part of the broader initiative, Russia’s central bank plans to require banks to link user accounts with personal tax identification numbers. This is designed to help identify so-called “money mules” (referred to as “droppers” in Russian slang), who are often exploited to move funds between fiat and cryptocurrencies during money-laundering schemes.

CBR Vice Governor Olga Polyakova confirmed that these data links are essential for the launch of the upcoming "Antidrop" platform, expected to go live in 2027.

Illegal mining still widespread despite crackdowns

In 2024, Russia formally legalized crypto mining, making it the first officially regulated crypto-related activity in the country. The law allows individuals, entrepreneurs, and businesses to participate. Individuals can mine legally without registration if their monthly power usage stays under 6,000 kWh, but anything beyond that requires mandatory registration with the Federal Tax Service.

Despite this legal path, less than one-third of mining operations have reportedly registered with the government. Both licensed and unlicensed miners have been blamed for power outages, particularly in regions with high crypto farm densities.

Authorities ramp up enforcement

Several regions in Russia have temporarily or permanently banned mining due to energy grid overloads. Still, many operators continue to run illicit mining farms, often tapping into stolen power lines and defying state-imposed restrictions.

Joint raids by energy companies, police, and agents from the Federal Security Service (FSB) are becoming increasingly common. Enforcement teams are now using smart electricity meters, internet traffic monitoring, and drones with thermal cameras to locate illegal mining sites.

At the same time, crypto miners are getting more inventive. Law enforcement has discovered mobile mining rigs in the back of trucks, and abandoned industrial or agricultural buildings repurposed as hidden mining hubs that still offer network access and electricity.

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