Russia targets illegal crypto miners with bill introducing prison sentences

Moscow plans criminal penalties for unregistered cryptocurrency mining, a year after legalizing the sector across the country.

The Russian Justice Ministry has proposed introducing criminal sanctions, including imprisonment, for illegal mining of cryptocurrencies, according to draft amendments published on December 30 on the government portal of regulatory legal acts.

The proposals would amend the Criminal Code and the Code of Criminal Procedure of the Russian Federation. The latest measure aims to formalize liability for digital currency mining outside the legal framework introduced last year. According to the draft, illegal mining could be punishable by a fine of up to 1.5 million rubles or forced labor of up to two years. Offenses involving particularly large income or committed by an organized group can carry prison sentences of up to five years.

Prison, forced labor, heavy fines

As part of this initiative, the Penal Code would be amended with a new article 171.6, entitled “Illegal mining of digital currency and activities of a mining infrastructure operator”. The article defines illegal mining as the extraction of digital currency by persons or entities not included in the official state register of persons engaged in cryptocurrency mining. Liability would be incurred if such activity causes large-scale damage to citizens, organizations or the state, or if it generates revenue of at least 3.5 million rubles.

The proposed article provides for sanctions including compulsory labor of up to 480 hours or forced labor of up to two years in cases meeting these thresholds. More severe sanctions would be applied in aggravated circumstances.

According to the second part of the draft article, offenses committed by an organized group, those that result in particularly large damage or those that are associated with particularly high income exceeding 13.5 million rubles, could be punished with fines ranging from 500,000 to 2.5 million rubles or fines equivalent to one to three years of the offender’s income. Courts could also impose up to five years of hard labor or up to five years in prison, with or without an additional fine of up to 400,000 rubles or six months’ income.

This proposal follows the legalization of cryptocurrency mining in Russia, which came into force in November 2024. On the same day, the Federal Tax Service launched special registers that require all legal entities, individual entrepreneurs and operators of mining infrastructure involved in the mining sector to register with the authorities.

According to the Federal Tax Service, more than 1,000 participants were on the books as of the end of May 2025. Current rules also require all miners, including individuals, to report the digital currency they have mined monthly via a dedicated section of the Federal Tax Service website.

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In early December, Deputy Prime Minister Alexander Novak said that the Russian government plans to introduce criminal liability in 2026 for illegal cryptocurrency mining as well as illegal lending.

Power theft by crypto miners

The crackdown comes amid growing concerns about pressure from illegal mining sites on Russia’s electricity infrastructure. Earlier this year, Rosseti Group, the country’s state-owned electricity grid operator, reported losses of more than 1.3 billion rubles in 2024 due to unauthorized “black” mining, particularly in the North Caucasus, Novosibirsk and Volga regions.

Some operators operated thousands of devices and illegally consumed electricity on an industrial scale, leading to more than 40 criminal investigations.