Illegal mining in Russia. Is it possible to fight it?

  • Elena Klimovich
  • 18:00 Feb 15, 2023
  • 207
Illegal mining in Russia. Is it possible to fight it?

The growth of the crypto-market after a prolonged crisis provokes not only large institutional miners to expand their capacities, but also illegal participants in the process to look for loopholes in the imperfect legislation. 

The most popular region in Russia for mining is the Irkutsk region. It is here, attracted by low electricity tariffs, that those who seek to make money from mining cryptocurrencies flock. 

Clandestine mining in the region has not only become a source of problems for the power grid but has also caused human deaths. The fact that gray mining is gaining momentum was noted by Igor Rylnikov, head of EMCD. 

Illegal miners most often become active when market conditions change. In January the income from cryptocurrency mining increased by 50%, which led to the connection of new devices to the network. Moreover, the process is not affected even by the rise in the price of the equipment compared to 2022. 

Oleg Ogienko of BitRiver emphasized the legality of digital asset mining:

There is no concept of "mining" in the legal field of Russia yet, so it is not legitimate to claim that it can be legal or not. However, the essence of the issue is the theft of electricity, which can entail both administrative and criminal liability. 

Thus, appropriate legislation is needed to address the issue of illegal mining. But consideration of a document that could help with this has been postponed indefinitely. 

Nevertheless, experts admit that at the current stage, it is possible to limit the introduction of a ban on the connection of such devices in the home, as well as to ask for help with tariff regulation. As additional measures, registration of equipment could be introduced, which would help, at least partially, to legalize the industry.

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