The Russian Bitcoin mining industry’s unofficial capital is now the Irkutsk Region in southeast Siberia.
In the unofficial Bitcoin (BTC) mining capital of Russia, authorities have continued their crackdown on illegal cryptocurrency mining, seizing 238 mining rigs from a community that purports to be gardening-related.
The state media outlet TASS reported that the Investigative Committee of the Russian Federation for the Irkutsk Region raided a “summer cottage village” settlement in Priangarye.
Russia’s Illegal Crypto Mining Problem?
According to the officers, “238 units of mining equipment” were seized. Additionally, they stated that “damages worth over 68 million rubles [$758,000]” had been caused by the illegal miners.
The Angarsky Bereg gardening partnership’s residents were said to be “in possession” of the mining rigs, according to the Committee.
The partnership is purportedly a non-profit organization made up of rural farmers and agriculturalists.
Southeast Siberia is home to the Oblast of Irkutsk Region. It has developed into the de facto hub of the Russian cryptocurrency mining industry in recent years.
Its low winter temperatures and renownedly low energy rates are largely to blame for this.
However, miners have been charged with overloading power grids in recent months, resulting in extensive disruption.
Electricity providers claim that the primary culprits are unauthorized miners who use improvised equipment to connect to the grid.
They also charge a lot of people with powering their rigs with subsidized electricity meant for residential use.
The committee announced that it had filed a “criminal case” against the miners, accusing them of crimes pertaining to fraud.
The miners “paid for electricity at a discounted rate” that was intended “for household needs,” according to the officers. The local prosecutor’s office has been given the case, according to the committee.
The Birth of a Russian BTC Mining Hub
Energy experts, according to TASS, believe that cryptocurrency mining “has been widely carried out in Irkutsk since 2019.”
They claimed that the rise of Irkutsk as a mining destination was largely “due to a ban on cryptocurrency mining in China” and “the lowest electricity tariffs for the population in the country.”
Officials said that most miners “are illegal,” adding that they typically “install equipment in houses, apartments, garages, summer cottages, and balconies.”
Russia has legalized industrial cryptocurrency mining as of September 1 in an effort to get around sanctions imposed by the US and EU.
However, miners must register their operations with a central regulator.
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Additionally, they might have to pay more for electricity. Additionally, when their grids are overloaded, provinces now have the authority to temporarily order miners to shut down their rigs.
A similar agricultural community in Irkutsk saw 500 rigs seized by authorities in July, and in May, prosecutors had filed charges against another suspected illegal miner.
Experts say that at least 90% of Russian crypto miners focus their efforts on Bitcoin.