Russia Losing ‘Millions of Dollars a Year to Illegal Crypto Miners’ – Report
Illegal and quasi-legal crypto mining is costing Russia “millions of dollars per year” in electricity and lost taxes, a news exposé has claimed.
Per a report from the Russian media outlet Ren TV, illegal mining farms are “leaving Russians without power and hitting their wallets.”
Russia: Illegal Crypto Miners Cost Taxpayers Dearly
The broadcaster reported that the fear of facing high taxes on their income and paying prohibitively high electricity costs is “driving many miners into the shadows.”
Ren TV explained: “The annual budget losses from underground mining amount to billions of rubles.”
Despite recent efforts to legalize the Russian crypto mining sector, so-called “gray-hat mining” has “become Russia’s newest epidemic,” the broadcaster continued.
Moscow has ordered all industrial miners to report their operations, earnings, and energy usage data to the Federal Tax Service.
In exchange, they have been granted legal “entrepreneurship” status, which allows big investors like banks to provide financing and investment.
However, while this is attractive to the country’s biggest players – the likes of BitRiver and Intelion – smaller-scale miners are less keen.
The outlet explained that in their quest to save money, crypto miners now “resort to fraud, deception, or under-the-table deals with energy companies.”
This means that in many cases, ordinary household and commercial consumers “are forced to pay for crypto miners’ operations.”
Southern Russia, the traditional stronghold of the Russian Bitcoin mining industry, has become Russia’s “Mecca of gray-hat mining,” the outlet explained.
‘Number of Illegal Crypto Mining Farms Rising by the Day’
Ren TV reported that experts believe that there are almost 140,000 Bitcoin and altcoin mining farms operating in Russia. They also think this number is “growing constantly.”
But power chiefs say that “the lion’s share” of crypto miners have not declared their operations and “remain underground.”
Experts added that buying electricity at commercial and industrial rates “eats up to 80% of crypto miners’ profits.” Their response is often to “cut costs illegally.”
Police have recently reported the arrest of an employee at the Omsk Thermal Power Plant who took a 500,000 ruble ($6,270) bribe to let local crypto miners steal power from the grid.
Illegal Crypto Mining Farm ‘Used More Power Than a Five-floor Building’
In St. Petersburg, police and power officials recently discovered a mining operator who had been bypassing electricity meters since 2018. This led to the city’s power grid losing around half a billion rubles ($6.3 million).
In Dagestan, meanwhile, power officials found a massive illegal crypto mining farm hidden in coolant tanks.
Only when the grid began to suffer issues did power providers finally realize what was happening. A power supply employee said the farm’s total load was 100 kilowatts/hour, adding:
“The illegal crypto mining farm was using more power than an entire five-story building.”
Another expert explained the appeal of illegal and quasi-legal mining, saying:
“With the right approach, taking into account the energy, equipment, premises, and so on, illegal mining is the most profitable type of activity out there.”
A Ren TV reporter visited a thermal power plant in Sharya, Kostroma Oblast (Central West Russia), where he showed that a boiler house manager was secretly mining BTC.
The farm, the reporter continued, “isn’t the only one in the region: There are plenty of companies willing to help miners.”
The broadcaster interviewed Sharya residents who said they were “convinced” that miners are responsible for “frequent power outages in their homes.”
— Cryptonews.com (@cryptonews) April 3, 2025
Russian bailiffs say they have developed new methods to help them convert Bitcoin (BTC) seized in criminal cases into cash for the state’s treasury.#Russia #Bitcoinhttps://t.co/a8ZnK7uvIX
These outages “damage household appliances,” the residents said, as these “simply can’t withstand the power surges and break.” No one has compensated them for these damages, the residents complained.
In his closing comments, the reporter said:
“Crypto entrepreneurs’ illegal businesses are finding it easy to find allies working in energy supply companies. They reap large profits. But the state loses billions in taxes. And ordinary citizens often end up without power.”
The post Russia Losing ‘Millions of Dollars a Year to Illegal Crypto Miners’ – Report appeared first on Cryptonews.
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Russia Losing ‘Millions of Dollars a Year to Illegal Crypto Miners’ – Report
Illegal and quasi-legal crypto mining is costing Russia “millions of dollars per year” in electricity and lost taxes, a news exposé has claimed.
Per a report from the Russian media outlet Ren TV, illegal mining farms are “leaving Russians without power and hitting their wallets.”
Russia: Illegal Crypto Miners Cost Taxpayers Dearly
The broadcaster reported that the fear of facing high taxes on their income and paying prohibitively high electricity costs is “driving many miners into the shadows.”
Ren TV explained: “The annual budget losses from underground mining amount to billions of rubles.”
Despite recent efforts to legalize the Russian crypto mining sector, so-called “gray-hat mining” has “become Russia’s newest epidemic,” the broadcaster continued.
Moscow has ordered all industrial miners to report their operations, earnings, and energy usage data to the Federal Tax Service.
In exchange, they have been granted legal “entrepreneurship” status, which allows big investors like banks to provide financing and investment.
However, while this is attractive to the country’s biggest players – the likes of BitRiver and Intelion – smaller-scale miners are less keen.
The outlet explained that in their quest to save money, crypto miners now “resort to fraud, deception, or under-the-table deals with energy companies.”
This means that in many cases, ordinary household and commercial consumers “are forced to pay for crypto miners’ operations.”
Southern Russia, the traditional stronghold of the Russian Bitcoin mining industry, has become Russia’s “Mecca of gray-hat mining,” the outlet explained.
‘Number of Illegal Crypto Mining Farms Rising by the Day’
Ren TV reported that experts believe that there are almost 140,000 Bitcoin and altcoin mining farms operating in Russia. They also think this number is “growing constantly.”
But power chiefs say that “the lion’s share” of crypto miners have not declared their operations and “remain underground.”
Experts added that buying electricity at commercial and industrial rates “eats up to 80% of crypto miners’ profits.” Their response is often to “cut costs illegally.”
Police have recently reported the arrest of an employee at the Omsk Thermal Power Plant who took a 500,000 ruble ($6,270) bribe to let local crypto miners steal power from the grid.
Illegal Crypto Mining Farm ‘Used More Power Than a Five-floor Building’
In St. Petersburg, police and power officials recently discovered a mining operator who had been bypassing electricity meters since 2018. This led to the city’s power grid losing around half a billion rubles ($6.3 million).
In Dagestan, meanwhile, power officials found a massive illegal crypto mining farm hidden in coolant tanks.
Only when the grid began to suffer issues did power providers finally realize what was happening. A power supply employee said the farm’s total load was 100 kilowatts/hour, adding:
“The illegal crypto mining farm was using more power than an entire five-story building.”
Another expert explained the appeal of illegal and quasi-legal mining, saying:
“With the right approach, taking into account the energy, equipment, premises, and so on, illegal mining is the most profitable type of activity out there.”
A Ren TV reporter visited a thermal power plant in Sharya, Kostroma Oblast (Central West Russia), where he showed that a boiler house manager was secretly mining BTC.
The farm, the reporter continued, “isn’t the only one in the region: There are plenty of companies willing to help miners.”
The broadcaster interviewed Sharya residents who said they were “convinced” that miners are responsible for “frequent power outages in their homes.”
— Cryptonews.com (@cryptonews) April 3, 2025
These outages “damage household appliances,” the residents said, as these “simply can’t withstand the power surges and break.” No one has compensated them for these damages, the residents complained.
In his closing comments, the reporter said:
“Crypto entrepreneurs’ illegal businesses are finding it easy to find allies working in energy supply companies. They reap large profits. But the state loses billions in taxes. And ordinary citizens often end up without power.”
The post Russia Losing ‘Millions of Dollars a Year to Illegal Crypto Miners’ – Report appeared first on Cryptonews.
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