Russia targets underground crypto miners with draft law introducing prison sentences

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

Russia’s Justice Ministry has proposed introducing criminal sanctions, including prison sentences, for illegal cryptocurrency mining, according to draft amendments published on December 30 on the government’s regulatory legal acts portal.

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

Prison, forced labor, heavy fines

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

The proposed article provides for penalties including compulsory labor for up to 480 hours or forced labor for up to two years in cases meeting these thresholds. In aggravated circumstances, stricter sanctions would apply.

According to part two of the draft article, crimes committed by an organized group, crimes resulting in particularly large-scale damage, or crimes related to a particularly high income exceeding 13.5 million rubles, may be punished with fines ranging from 500,000 to 2.5 million rubles or with fines equal to one to three years of the offender’s income. Courts can also impose up to five years of hard labor or up to five years of imprisonment, with or without an additional fine of up to 400,000 rubles or six months’ income.

The proposal comes after the legalization of cryptocurrency mining in Russia, which came into effect in November 2024. On the same day, the Federal Tax Administration launched special registers that required all legal entities, individual entrepreneurs and mining infrastructure operators involved in the mining sector to register with the authorities.

According to the Federal Tax Authorities, more than 1,000 participants had been included in the registers by the end of May 2025. The current rules also require all miners, including individuals, to report their mined digital currencies monthly through a special section of the Federal Tax Authorities website.

You might also like:

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

Power Theft by Crypto Miners

The crackdown comes against the backdrop of growing concerns about the pressure illegal mining sites are putting on Russia’s energy infrastructure. Earlier this year, Rosseti Group, the country’s electricity grid operator, reported losses of more than 1.3 billion rubles by 2024 due to unauthorized “black” mining activities, mainly in the North Caucasus, Novosibirsk and Volga regions.

Some operators ran thousands of appliances and used electricity illegally on an industrial scale, triggering more than 40 criminal investigations.