Okay, so picture this: you’re trying to watch Netflix, and suddenly the lights flicker because your neighbor is running a crypto mine in their garage.
Well, that’s pretty much what’s happening in Russia, but on a much grander scale.
Authorities aren’t happy
Rosseti, Russia’s state-owned power grid operator, is fuming after losing $14.2 million in 2024 alone to illegal crypto mining.
Apparently, sneaky miners have been hooking up to the grid without permission, siphoning off massive amounts of subsidized, cheap electricity.
The hardest-hit areas include the North Caucasus, Novosibirsk, and the Volga region. In the North Caucasus alone, losses topped $6.6 million. It’s like a crypto free-for-all, and Rosseti is left footing the bill.
Dark side
The local reports reveal that authorities have uncovered 130 cases of these unauthorized mining operations so far, and these miners aren’t just setting up shop in industrial areas, they’re hiding in underground parking lots, warehouses, and even containers on rented land.
One particularly audacious operation in Novosibirsk involved a quite huge illegal farm with 3,200 mining devices, sucking up electricity on an industrial scale. That single operation cost Rosseti $2.2 million.
Mining is profitable, especially with cheap electricity
Rosseti isn’t taking this lying down, so they’ve teamed up with law enforcement to crack down on these illegal operations, leading to over 40 criminal cases and multiple arrests.
These culprits could be facing some serious prison time.
But why is this happening? Well, crypto miners are trying to dodge rising energy costs and government restrictions.
As crypto adoption grows, Russia may be forced to introduce stricter rules on mining, as they’ve already started with seasonal bans in some regions and plans for a mandatory registry of mining equipment. Maybe they will introduce some new taxes too.
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