Increase in Crypto-Related Crimes
Russia is witnessing a sharp rise in crypto-related crimes, prompting the Supreme Court to draft legislation recognizing cryptocurrencies as property in criminal cases. Chairperson Irina Podnosova addressed the issue in a meeting with President Vladimir Putin, highlighting the growing use of digital assets in illegal activities.
Illegal Mining and Financial Fraud
Apart from illicit transactions, illegal crypto mining has become a significant problem. Rosseti Group, Russia’s power company, reported over $14 million in damages in 2024 alone due to unauthorized mining operations. The most affected regions include North Caucasus, Novosibirsk, and Volga, where mining has overburdened the national power grid.
To curb these illegal operations, Russia has implemented seasonal mining bans in several regions, which are set to remain in place until 2031. Additionally, authorities are considering stricter penalties, including criminal charges for unauthorized miners.
Russia’s Dual Approach to Crypto Regulation
While Russia is cracking down on illicit crypto activities, the country is simultaneously exploring ways to use digital assets to bypass Western sanctions. Blockchain analytics firm Chainalysis recently reported that Russia has been actively using cryptocurrency for economic resilience, even as it enforces stricter domestic controls.
Authorities are working on a national registry for mining equipment and stronger compliance measures for exchanges. Despite the regulatory tightening, non-compliant crypto platforms continue to emerge, enabling illicit financial activity.
Russia's approach to crypto remains paradoxical—tightening domestic regulations while embracing digital assets for geopolitical strategy.
