Russia Seizes Mining Rigs, Imposes New Crypto Mining Ban

Russia has continued to supervise the nation’s cryptocurrency mining sector with the recent discovery of a mining farm hidden in an orphanage in Siberia. 

The official press release of Irkutsk Oblast Prosecutors office has confiscated over 90 mining rigs from a facility in the village of Kazachye.

With the loosening, Russia is becoming one of the major locations preferred by digital asset mining in the nation. 

Illegal crypto mining has surged at a greater pace in Russia

With the discovery of illicit mining rigs, the building of the non-profit organization is closed by the authorities, and it is also reported that the building has three stories.

The prosecution revealed that a Siberian non-profit, whose name has not been disclosed, was responsible for operating the “farm” and installing the mining rigs at the orphanage. 

An Irkutsk court instructed bailiffs to disconnect the equipment and halt the illegal use of the land.

Prosecutors stated that the farm operators put human lives at risk by violating safety regulations related to electricity and fire hazards. 

Authorities added that the operators neglected to perform necessary maintenance on the electrical systems and wiring and failed to install fire alarms and other required safety measures.

The region’s extremely cold winters help miners significantly reduce cooling costs. However, this has caused a severe strain on the power grid in Irkutsk and its surrounding areas.

As a result, the governor of the Oblast has proposed a year-round ban on cryptocurrency mining in much of Irkutsk, lasting until 2031.

Despite these measures, there is little evidence that such bans effectively deter illegal crypto mining in Irkutsk or other parts of Russia.

Major Russian news outlets have reported that operators of illegal mining farms are setting up equipment in various locations, including apartments, private properties, gardening communities, and commercial buildings.

Russia planning to draft harsh rules for crypto-mining 

Russian authorities have approved a list of regions where cryptocurrency mining will be prohibited starting January 1, 2025. The ban will be in effect for six years, concluding on March 15, 2031. This decision was made on Tuesday.

These actions are in line with the cryptocurrency mining regulations signed into law by President Vladimir Putin in August and October 2024, which are designed to regulate energy usage.

The ban will apply to ten regions, including Dagestan, Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia, North Ossetia, Chechnya, Donetsk, Lugansk, Zaporizhzhia, and Kherson.

This restriction will impact both mining pools and individual miners. Additionally, seasonal limitations will be imposed in three Siberian regions, Irkutsk, Buryatia, and Zabaikalsky, during peak energy consumption periods. 

These seasonal restrictions will be in effect from January 1 to March 15, 2025, and will continue annually from November 15 to March 15.