Crypto miners in Moscow face new threat as Russia tightens rules

Russian officials have moved closer to a long-term shutdown of crypto mining in Moscow and nearby regions as lawmakers have advanced a separate bill to jail unregistered miners.

According to TASS, Deputy Energy Minister Evgeniy Grabchak said a government commission overseeing the electric power industry has backed a proposal to ban mining in the city of Moscow, the surrounding Moscow Oblast, and parts of the Kursk region, with the restriction expected to last until at least 2032.

Local officials raised the issue in late April, the ministry said, and the final decision will take their positions into account, according to a report by RBC.

Moscow area faces proposed six-year prohibition

In Moscow Oblast, regional Energy Minister Sergey Voropanov has argued that crypto mining brings little benefit to the local economy and has said that earlier restrictions elsewhere produced positive results, according to reports cited by RBC and Bits.media.

Bits.media has also recalled that Moscow Oblast Governor Andrey Vorobyov and Moscow Mayor Sergey Sobyanin have both proposed limits on mining in their jurisdictions.

The Russian energy ministry has counted at least 65 data processing centers connected to the grid across Moscow and the Moscow region, with a total capacity of 734 megawatts, according to figures cited in the report.

A separate Kommersant report has said the government is weighing a mining ban across 19 regions within Moscow’s power distribution zone, a move that would curb activity across the Central Federal District, which Kommersant described as the country’s main economic center.

In the Kursk region, Governor Alexander Khinshtein has proposed restricting mining in eight districts and the city of Lgov, according to the same coverage.

Khinshtein’s administration has said the region’s power supply problems have worsened due to the war in neighboring Ukraine, and has argued that a mining ban would free up reserve capacity and save electricity for other users, including residential and industrial customers.

The planned limits in Kursk have been discussed alongside the Moscow-area proposal, as Russian authorities consider how to reduce strain on local grids in regions with heavy power demand.

State Duma advances bill to criminalize illegal mining

In Moscow, the State Duma has passed a bill on first reading that would criminalize illegal mining, according to RIA Novosti and Prime.

The draft law sets penalties for mining without registration or for using stolen electricity, with punishments that can include fines, forced labor, and prison terms, RIA Novosti and Prime have reported.

Operators whose illegal facilities generate large income or cause major financial damage could face fines up to 2.5 million rubles, or about $35,000, according to the same reports.

For mining tied to an organized crime group, the legislation allows prison sentences of up to 5 years, forced labor, and additional fines, while also granting authorities the power to confiscate property, RIA Novosti and Prime reported.

Tightening rules after mining was legalized in 2024

Russia legalized cryptocurrency mining in 2024, with officials describing the country’s energy resources and climate as advantages, according to prior reporting referenced in the article.

After miners clustered in places with cheap electricity, energy deficits followed in several areas, the same coverage said, and Russian authorities responded last year by banning mining in 13 regions until spring 2031.

Those territories include Irkutsk Oblast, the Republic of Buryatia, Zabaykalsky Krai, most republics in the North Caucasus, and four occupied Ukrainian regions, according to the report.

Although individuals and companies can mine legally if they register and pay taxes, an explanatory note to the draft law has said fewer than 1,500 of an estimated 50,000 mining businesses have registered so far.