Illegal mining activities in the Russian Bitcoin mining hub of Ingushetia have caused significant losses amounting to $4.3 million in electricity theft during the first half of 2025, according to Rosseti, the state-owned power company.
According to an official press release from Rosseti North Caucasus, illegal miners were responsible for over 94% of the total electrical power stolen in the region during this period. The total volume of unaccounted consumption in Ingushetia was reported to be 37.5 million kWh, valued at over $4.4 million.
The majority of this stolen power, amounting to 35.4 million kWh, was attributed to illegal crypto miners. Rosseti stated that the bulk of the electricity theft occurred at four large “illegal mining farms,” all of which have been shut down by the provider. Additionally, 450 mining rigs were seized from these facilities.
Ingushenergo, the power firm in the republic, identified 177 instances of illegal electricity use in the first half of the year. Crypto mining is prohibited in Ingushetia during the winter months until March 15, 2031, and similar bans are in place in neighboring North Caucasus republics.
Despite these restrictions, Bitcoin mining continues to be a popular activity in the region and has been linked to power outages in Ingushetia. In Abkhazia, entire villages are reportedly filled with the noise of operating crypto mining hardware.
To combat illegal mining activities, power providers in the region have employed drones equipped with thermal imaging cameras to detect unauthorized mining operations. In Dagestan, energy companies are offering incentives to employees for uncovering underground crypto mining farms.
Russian law allows firms and individuals to mine cryptocurrencies without notifying tax authorities if they consume less than 6,000 kWh of electricity per month. However, industrial miners who fail to register with the Federal Tax Service may face criminal penalties under proposed regulations.
It is estimated that around 90% of industrial crypto miners in Russia focus on mining Bitcoin (BTC). These ongoing challenges highlight the need for increased regulation and enforcement measures to address illegal mining activities in the country.