Courts could jail illegal miners for up to five years, and the Justice Ministry also proposes heavy fines for offenders. On December 29, the ministry released a draft outlining strict new punishments for those who steal power from public grids or mine in areas where mining is banned. The harsher penalties would apply especially if a miner’s actions cause major damage to citizens, organisations, or the state, or are linked to large-scale income extraction. Illegal crypto mining has become a major issue in Russia, blamed for power shortages in hotspots such as Irkutsk and the North Caucasus.
Lawmakers have long lamented the courts’ inability to hand out adequate sentences, with illegal miners typically escaping with fines for improper use of electricity. The amendment would criminalize illegal crypto mining and would need State Duma approval. Under current rules, Russians can mine in most areas as long as they use no more than 6,000 kWh per month; exceeding this requires registration with the Federal Tax Service, which collects data on mined coins, with industrial miners expected to pay more than $600 million in tax per year.
But illegal crypto mining has become a sophisticated shadow industry in Russia in recent years. Many miners use mobile units, sometimes housed in shipping containers or vans, to evade detection. Others have bribed power officials, and, in 2019, security service officials caught two Russian Nuclear Centre staffers using a supercomputer to mine Bitcoin.
The ministry’s proposals would allow courts to impose fines of up to $19,000 on convicted private miners. Judges would also be allowed to hand out forced labour camp sentences of up to two years, regular jail sentences of up to five years, and community service orders of up to 480 hours. Under the amendment, organised groups of miners will face higher fines of up to $32,000.
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