Russian energy provider Rosseti reportedly suffered significant financial losses in 2024 due to illegal cryptocurrency mining. The losses amounted to approximately 1.3 billion rubles ($14.2 million). According to a report by local media outlet Tass, Rosseti attributed these losses to unauthorized electricity consumption across multiple regions. The North Caucasus Grid alone accounted for 600 million rubles ($6.6 million) in losses, while additional losses were recorded in Novosibirsk, the Center, and the Volga regions, totaling 520 million rubles ($5.7 million).
Authorities discovered one of the largest illegal mining operations in Novosibirsk, where 3,200 mining devices were confiscated. This single operation resulted in a financial loss of 197 million rubles ($2.2 million). In total, Rosseti uncovered 130 cases of unauthorized grid connections linked to crypto mining. These incidents have been handed over to law enforcement, leading to over 40 criminal cases. Those involved could face legal consequences under Russia’s criminal code.
Rosseti has warned about the dangers of illegal mining, emphasizing that unauthorized electricity use can overload the grid, lower voltage levels, and damage electrical equipment. These disruptions not only affect the company’s infrastructure but also impact regular users.
In an effort to optimize energy use and address the challenges posed by unauthorized mining, Rosseti has announced plans to explore legal Bitcoin mining projects. The company aims to establish mining operations in areas with excess electricity, leveraging surplus energy to improve efficiency and boost revenue.
The crackdown on unauthorized mining in certain areas comes at a time of rising demand for crypto-mining equipment in Russia. In 2024, demand for industrial mining equipment reportedly tripled compared to the previous year. This increase can be attributed to Russia’s recently introduced regulatory framework, which provided more clarity for the mining industry and recognized digital assets as taxable property.
However, authorities are tightening their grip on unauthorized operations. Efforts are underway to track illegal miners more effectively, with regulators pushing for a nationwide registry of mining equipment. This registry will help monitor and regulate the mining industry more efficiently.
Overall, Rosseti’s experience with illegal crypto mining highlights the financial risks and potential disruptions associated with unauthorized electricity consumption. By exploring legal Bitcoin mining projects and leveraging surplus energy, the company aims to strengthen its financial position while addressing the challenges posed by unauthorized mining.
