Russian Authorities Crack Down on Illegal Bitcoin Mining Operations—Seize Digital Assets

In a bold move against unauthorized crypto mining, Russian investigators have started confiscating Bitcoin from illegal operations. The crackdown highlights the government’s tightening grip on the unregulated corners of the digital asset space—because nothing says ’state oversight’ like seizing decentralized currency.

While the exact amount of seized Bitcoin remains undisclosed, the message is clear: mine at your own risk. Meanwhile, traditional financial institutions are probably nodding approvingly—after all, nothing disrupts their monopoly like pesky, permissionless innovation.

Seizing Bitcoin From Miners – A New Move from Moscow

The DRSC is an electrical grid provider. It transports electricity on distribution networks in the Amur Oblast, in Russia’s Far East.

Investigators say the man used his expert knowledge of his firm’s power distribution systems to siphon electricity from the grid. He used this electricity to power BTC mining rigs, they add.

The SKR explained that the man was found “mining cryptocurrency in his own residential building, using his knowledge in the field of technological connection to electrical networks.”

Investigators added that the man used his skills to bypass a metering device in 2024. They say he then created an illegal connection to his employee’s electrical grid facilities.

Officers estimated that the man used more than 3.5 million rubles ($44,334) of DRSC’s electricity.

The SKR is Russia’s main federal investigating authority and anti-corruption agency. The body said it worked with the Federal Security Service to secure the Bitcoin.

Police say the same man also took bribes from business owners in the Oblast. The owners allegedly paid the executive to approve electricity-related documentation.

Russian officials said more than 700,000 households were without electricity in two Ukrainian regions it partially occupies, following damage to energy infrastructure https://t.co/UpsEEEIcKa

Legal Challenges

Seizing Bitcoin and other tokens has proved tricky for investigators in the past, as BTC has no legal status in Russia.

However, this could be about to change. In April this year, ministries developed a legal mechanism that proposes granting courts and law enforcers new powers to confiscate crypto in criminal cases.

The measure has the support of government policy-makers. If passed, it WOULD allow officials to recognize cryptoassets as intangible property in criminal cases.

Investigators appear to have adopted the spirit of this draft law in several high-profile cases. These include the server operator of the Hydra darknet portal, from whom police have seized $8.2 million worth of crypto.

Bailiffs have also confiscated BTC 1,032 from the former Russian Investigative Committee investigator Marat Tambiev.

A court found the ex-investigator guilty of taking Bitcoin bribes from an international fraud network and jailed him for 16 years.