Impact of Illegal Crypto Mining on Russian Energy Provider Rosseti
Russian energy provider Rosseti faced a significant financial setback in 2024 due to illegal crypto mining activities, resulting in losses amounting to approximately 1.3 billion rubles ($14.2 million).
Unauthorized Electricity Consumption Across Regions
According to reports from local media outlet Tass on Feb. 18, Rosseti attributed these losses to unauthorized electricity consumption in various 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).
Largest Illegal Mining Operation Uncovered
Authorities discovered one of the largest illegal mining operations in Novosibirsk, where 3,200 mining devices were confiscated, resulting in a financial loss of 197 million rubles ($2.2 million).
Legal Consequences and Criminal Cases
Rosseti reportedly uncovered 130 cases of unauthorized grid connections linked to crypto mining, leading to over 40 criminal cases. Those involved could potentially face legal consequences under Russia’s criminal code.
Dangers of Illegal Mining
Rosseti has cautioned about the risks associated with illegal mining, highlighting that unauthorized electricity use can overload the grid, lower voltage levels, and damage electrical equipment. These disruptions impact both the company’s infrastructure and regular users.
Rosseti’s Approach to Legal Bitcoin Mining
The energy firm is exploring legal Bitcoin mining projects to optimize energy use. Rosseti plans to establish mining operations in areas with excess electricity to enhance efficiency and increase revenue.
Utilizing Surplus Energy for Financial Strengthening
By using surplus energy for mining operations, Rosseti aims to bolster its financial position while addressing the challenges posed by unauthorized mining activities.
Russia’s Bitcoin Mining Landscape
The crackdown on unauthorized mining activities coincides with the growing demand for crypto-mining equipment in Russia. Industrial mining equipment demand reportedly tripled in 2024 compared to the previous year, attributed to the country’s evolving regulatory framework that provided clarity for the industry.
Authorities are intensifying efforts to track illegal miners effectively, with a push for a nationwide registry of mining equipment to curb unauthorized operations.
