Russia Cracks Down on Crypto Mining With New Prison Penalties

Russia is tightening the rules around cryptocurrency mining, and this time the penalties could be severe.

The Ministry of Justice has proposed amendments to the Criminal Code that would punish unregistered miners with fines, forced labor, and in extreme cases, prison sentences of up to five years.

These measures aim to curb illegal operations, prevent energy misuse, and ensure that mining activity is properly reported and taxed.

Following the legalization of crypto mining in November 2024, this move underscores the government’s intent to balance economic benefits with stricter oversight, making it clear that operating outside the system will carry serious consequences.

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Key Takeaways

1. Unregistered crypto miners could face fines up to 1.5 million rubles and forced labor.

2. Large scale or organized illegal mining may lead to up to five years in prison.

3. The law strengthens reporting, compliance, and regulatory control over Russia’s mining industry.

What Is Russia’s New Crypto Mining Law?

The proposed legislation adds Article 171.6 to Russia’s Criminal Code, titled “Illegal mining of digital currency and activities of a mining infrastructure operator.”

This law targets individuals and organizations conducting crypto mining without official registration.

Any miner not included in the official registry could face penalties, depending on the scale and profitability of their operations.

Penalties Under the Draft Law

• Basic violations: Fines up to 1.5 million rubles or two years of forced labor.

• Profitable mining: For mining generating income above 3.5 million rubles, penalties include fines, up to 480 hours of forced labor, or prison time.

• Organized illegal mining groups: Income over 13.5 million rubles could trigger fines up to 2.5 million rubles, forced labor up to five years, or prison sentences.

The legislation clearly differentiates between minor violations and large scale operations, signaling that Russia is serious about maintaining compliance and accountability within its rapidly growing crypto mining sector.

Read Also: Russia’s Largest Bank Backs Bitcoin Mining With Cryptocurrency Collateral

Impact on Miners and the Industry

Since November 2024, mining in Russia has been legal but strictly regulated. Miners are required to register with the Federal Tax Service and report mined assets monthly.

Over 1,000 miners were registered by mid-2025, but illegal operations persisted, often involving energy theft or unreported income. The new penalties are expected to deter unregistered activity and encourage full compliance.

Implications for the Market

• May push underground miners to formalize or relocate operations abroad

• Could strengthen tax revenues and improve oversight of energy consumption

• Highlights a shift toward centralized control while preserving legal mining opportunities

Critics warn that harsh penalties might stifle innovation or encourage migration to countries with less stringent rules.

Supporters argue that enforcement is essential to prevent blackouts, safeguard the grid, and maintain the integrity of Russia’s emerging digital asset framework.

Read Also: Russia Legalizes Crypto Payments: Top Beneficiary Tokens

From Gray Area to Tightly Controlled Sector

Russia’s approach to crypto mining has evolved over the past decade. Mining was largely unregulated before 2024, with concerns over energy use and potential sanctions evasion.

By 2023, Russia had become the world’s second largest crypto miner, with production concentrated in energy rich regions such as Siberia.

The 2024 legalization defined clear rules for registration, reporting, and taxation, creating a legal pathway for miners.

Compliance Challenges and Enforcement

• Rapid sector growth has outpaced regulatory oversight

• Illegal miners often exploit electricity supply, causing strain on local grids

• Proposed criminal liability ensures miners adhere to reporting and registration requirements

The new criminal penalties make it clear that the government expects full compliance from all participants in the mining ecosystem.

This formalization is intended to secure both economic and energy stability while signaling that violations carry serious consequences.

Read Also: Russian Central Bank Sets New Crypto Rule for 2026: Here Are the Details!

Conclusion

Russia’s proposed amendments to the Criminal Code represent a major escalation in regulating cryptocurrency mining.

By introducing fines, forced labor, and prison sentences for unregistered miners, the government is sending a clear message that compliance is mandatory.

Legal mining remains an opportunity, but only for those willing to operate transparently, report assets, and follow state guidelines.

As the law moves toward potential implementation in 2026, miners and investors must carefully consider registration and adherence to avoid severe penalties.

This approach reflects Russia’s broader strategy to maintain control over the crypto industry while balancing economic benefit, energy security, and legal oversight.

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FAQ

What penalties does Russia propose for illegal crypto mining?

Fines up to 1.5 million rubles, forced labor, or up to five years in prison for large scale or organized violations.

Who is affected by the new law?

Individuals and organizations mining cryptocurrency without registration in Russia.

When will the law take effect?

The draft is under review, with potential implementation planned for 2026.

Why is Russia introducing stricter penalties?

To prevent illegal mining, safeguard energy resources, and ensure proper reporting and taxation.

Can legal miners continue operating safely?

Yes, registered miners following reporting requirements can operate legally under Russia’s crypto mining framework.

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