Russia is taking a much tougher stance on illegal cryptocurrency mining, introducing criminal penalties that could mean jail time, forced labor, and steep fines for unregistered operations.
Key Takeaways
- Russia’s Ministry of Justice has proposed criminal charges for illegal crypto mining, replacing previous administrative penalties.
- Unregistered miners could face up to five years in prison, along with fines reaching 2.5 million rubles.
- Only 30% of crypto miners in Russia are registered, despite mining being legalized in late 2024.
- The move aims to curb power strain and tax evasion, especially in regions affected by illegal mining operations.
What Happened?
The Russian government has taken a major step to regulate its booming crypto mining sector by targeting illegal miners with harsh criminal penalties. Despite the legalization of crypto mining in 2024, the majority of operators have failed to register or comply with the country’s tax laws. The Ministry of Justice is now moving to enforce stricter control through proposed amendments to the Criminal Code.
For years, crypto mining thrived in the grey zone.
— Crypto Wave (@Crypto_Wavee) December 30, 2025
Now the Ministry of Justice wants to criminalize unregistered operations — with just 30% of miners on the books.
Moscow’s patience is wearing thin.#CryptoRegulation pic.twitter.com/cC0TsFuqja
From Legalization to Enforcement
Crypto mining became legal in Russia following a law signed by President Vladimir Putin in August 2024, which took effect on November 1 of that year. The law introduced compulsory registration, monthly tax reporting, and allowed for regional mining restrictions in areas with power shortages. It also banned foreign entities from engaging in mining within Russia.
However, enforcement proved weak. As of June 2025, only about 30% of miners were officially registered, according to Deputy Finance Minister Ivan Chebeskov. The rest continued operating in the shadows, often in regions like Irkutsk where electricity is cheap and abundant, but also increasingly overburdened.
Criminal Penalties for Illegal Mining
The proposed legislation introduces tough penalties for those caught mining illegally:
- Basic violations could lead to fines between 500,000 and 1.5 million rubles, or up to 2 years of forced labor.
- More serious offenses, such as mining that produces “particularly large” profits or involves organized groups, could lead to:
- Up to 5 years in prison
- Forced labor up to 5 years
- Fines up to 2.5 million rubles
- Additional penalties, including up to 480 hours of compulsory community labor
Smaller one-off violations may still fall under administrative fines, but repeat or large-scale violations will now trigger criminal investigations and prosecutions.
Why the Crackdown?
Russia’s crypto mining industry has become one of the largest consumers of domestic energy, due to the country’s cheap electricity. But illegal mining has created serious strain on local infrastructure, causing power outages and revenue losses from unpaid taxes.
Authorities have already taken action in some cases, including:
- Arresting electric grid employees who secretly assisted illegal miners.
- Shutting down large unregistered farms.
- Imposing temporary bans in regions with energy deficits during winter months.
Despite these efforts, illegal mining persisted, prompting this escalation to criminal liability. The government hopes the new penalties will deter rogue miners and finally bring the industry under control.
CoinLaw’s Takeaway
In my experience, when a government legalizes something like crypto mining, it usually signals a path toward regulation, not a free-for-all. What’s striking here is how quickly Russia has pivoted from legalization to full-blown criminal enforcement. This tells me the scale of the illegal mining problem is far worse than officials initially expected. I found the fact that only 30% of miners registered especially telling. Clearly, most operators have been gaming the system to dodge taxes and electricity costs. This new law is the state’s way of saying: play by the rules, or face serious consequences. And for anyone mining in Russia, this is the moment to either go legit or get out.
