Russian Crypto Mining Hotspot Cracks Down on Illegal Miners

The Russian crypto mining hotspot of Irkutsk appears to be cracking down on illegal and quasi-legal miners.

Per a Telegram post from the Irkutsk Prosecution Service, an unnamed crypto miner, aged 35, will “stand trial for stealing electricity” in the town of Cheremkhovo.

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The move comes shortly after the power provider Rosseti closed down 17 illegal crypto mining farms in Krasnoyarsk, Omsk, and Khakassia.

Rosseti also announced it had shut down 36 “illegal” crypto mining farms in the Republic of Dagestan since 2022.

Similar crackdowns have been carried out in the nearby de facto nation of Abkhazia, another unofficial crypto mining hub.

The Irkutsk Oblast is hopeful that the Russian energy ministry will press ahead with its controversial plans to hike energy prices for miners.

Oblast officials hope this move will help stem the flow of new miners to the region. They also hope this will relieve the pressure on its power grids.

Irkutsk Looks to Shut Down ‘Grey’ Miners

Prosecution officials released photographs of the equipment they seized in a raid on the 35-year-old’s mining “farm” in Cheremkhovo.

Crypto mining equipment seized by Russian prosecution officials in a raid in the Irkutsk Region. (Source: Irkutsk Prosecution Service)

Prosecutors think the miner “caused damage” worth around $11,000, and have indicted him for “causing property damage by deception or abuse of trust.”

Investigators said the miner was active in early 2023 in Cheremkhovo. They claimed the man rented a plot of land with the intention of building a mining farm.

The plot included “a non-residential building with an integrated transformer substation.”

The man allegedly “installed 214 pieces of computer equipment, which was used for mining cryptocurrency.”

In itself, this is not a crime, as crypto mining still has no legal status in Russia. However, many so-called “grey” miners use illegal grid connections.

The prosecution claimed that the miner “illegally connected jumper wires to the substation’s current transformers.”

This allowed him to “unaccountably consume electricity” without “proper payment.” Police swooped on the farm in February 2023.

However, the case has taken over a year to process, due mainly to the fact that the man can only be charged with energy theft-related offenses.

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In Krasnoyarsk, prosecutors said that a group of illegal crypto mining farm operators stole $434,800 worth of electricity from the local grid.

Energy providers say they have developed new tools and methods that allow them to identify illegal miners faster.