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Russia steps up crackdown on illegal crypto miners
The article deals with the actions of the city of Irkutsk in Russia against illegal crypto miners. It reports on the upcoming trial of a 35-year-old miner who is accused of electricity theft. More information about Irkutsk's efforts to curb energy consumption by crypto miners is also mentioned. Learn more about the city's actions and the impact on the regional crypto mining industry.
Russia steps up crackdown on illegal crypto miners
The Russian crypto mining stronghold Irkutsk appears to be cracking down on illegal and semi-legal miners. A 35-year-old crypto miner will stand trial on charges of stealing electricity, according to a press release from the Irkutsk prosecutor's office. This move comes shortly after electricity utility Rosseti shut down 17 illegal crypto mining farms in Krasnoyarsk, Omsk and Khakassia. Rosseti also announced that it has closed 36 “illegal” crypto mining farms in the Republic of Dagestan since 2022. Similar measures have already been taken in the nearby de facto nation of Abkhazia, another unofficial crypto mining hub.
The Irkutsk region hopes to stem the flow of new miners to the region through the Russian Energy Ministry's controversial plans to increase electricity prices for miners. There is also hope that this will reduce pressure on the power grids. In a crackdown on the 35-year-old miner, photos of the equipment seized, including 214 computer devices, were released. Prosecutors allege that the miner illegally connected cables to the electricity provider's electricity meters in order to consume electricity without paying. The case has taken over a year because the man can only be charged with energy theft-related crimes.
Impact and context
Russian authorities' actions against illegal crypto mining have increased in recent years. This is due to the high energy requirements of crypto mining farms, which often come at the expense of power grids and consumers. Rosseti has already closed several illegal mining farms and it is likely that more closures will follow. An increase in electricity prices for miners is expected to help stem the flow of new miners to the Irkutsk region and ease pressure on power grids.
It is important to note that crypto mining does not yet have legal recognition in Russia, which has resulted in a gray area with many miners using illegal power connections. Law enforcement in this area is often difficult because there are no clear legal provisions. However, the current case in Irkutsk shows that the authorities are committed to cracking down on illegal practices and holding miners accountable.
To better understand the impact of Russia's measures against illegal crypto mining, it is also interesting to know that similar measures have been taken in other parts of the world. For example, China has imposed strict regulations on crypto mining and shut down numerous illegal farms in recent years. These measures have led to crypto mining moving to other countries, including Russia.
In the table below you will find information about the closed illegal crypto mining farms in Krasnoyarsk, Omsk, Khakassia and the Republic of Dagestan since 2022:
| region | Number of closed crypto mining farms |
|---|---|
| Krasnoyarsk | 17 |
| Omsk | 17 |
| Khakassia | 17 |
| Republic of Dagestan | 36 |
Conclusion
The Russian crypto mining hub of Irkutsk is taking decisive action against illegal and semi-legal miners by cracking down on electricity theft and shutting down illegal crypto mining farms. These measures have already been implemented by other Russian regions and countries such as China to prevent misuse of power grids. The hope is that increasing electricity prices for miners in Irkutsk will limit the influx of new miners and ease pressure on power grids. It remains to be seen how these measures will affect crypto mining and the crypto industry as a whole. In any case, this case shows that Russian authorities are committed to combating illegal practices and regulating the crypto mining industry.