Russia Sees Surge in Crypto Crime, Supreme Court Warns

Russia is grappling with a rise in cryptocurrency-related crimes, as digital assets increasingly play a role in illegal activities. The country’s Supreme Court is now considering legal reforms to address the issue, while authorities crack down on illicit crypto mining operations that are draining the nation’s power grid.

Crypto at the Center of Criminal Activity

The warning came from Irina Podnosova, Chairperson of the Russian Supreme Court, during an annual meeting of judges. She highlighted how cryptocurrencies are being used not just as a means of crime but also as a form of illicit income and even as targets of criminal offenses.

Russia has long had an ambiguous relationship with digital assets. While not outright banning them, the government has imposed restrictions on their use in certain financial activities. Now, with cybercrime involving crypto on the rise, authorities are pushing for stricter regulations.

One of the key proposals on the table is recognizing digital assets as property in criminal cases. This would allow courts to handle crypto-related offenses more effectively, ensuring that stolen or illegally obtained digital assets can be seized and included in legal proceedings.

Illegal Crypto Mining Drains Russia’s Power Grid

Beyond financial crime, illegal cryptocurrency mining has become a major issue. The energy-intensive process of mining has led to millions of dollars in damages to Russia’s power grid, particularly in regions where electricity supplies are already strained.

A report from state-owned news agency TASS revealed that power company Rosseti Group has suffered over $14 million in losses due to illegal mining operations in 2024 alone. The hardest-hit areas include:

• North Caucasus
• Novosibirsk
• Volga Region

Authorities say unauthorized mining operations overload the grid, causing blackouts and damaging both industrial and household electrical equipment. In response, seasonal mining bans have been introduced in several regions, with officials considering a broader national ban.

Some Regions Face Total Mining Ban

Deputy Head of Russia’s Ministry of Energy, Yevgeny Grabchak, has been vocal about the impact of illegal mining. He confirmed that mining will soon be banned at the state level in specific areas facing energy shortages.

“Some regions already have scarce zones—this includes the Far East, the southwest of Siberia, and the South,” Grabchak stated. He added that power capacity in these regions is limited and will remain so until at least 2030.

The government is taking these steps to prevent further strain on an already fragile power infrastructure. Unauthorized mining operations often steal electricity, making it difficult for authorities to manage supply and demand effectively.

Crypto Taxation Comes Into Effect in 2025

Another major shift in Russia’s approach to cryptocurrency is taxation. A law that went into effect on January 1, 2025, brings cryptocurrency trading under the same tax structure as securities trading. This means that crypto traders must now declare their earnings and pay taxes accordingly.

The bill, which reached President Vladimir Putin in late 2024, represents a significant shift in Russia’s regulatory stance. While the country has not fully embraced crypto, it is now actively integrating it into its financial system—at least in terms of taxation.

For many in Russia’s crypto community, these changes signal increasing government oversight. Whether this will curb crime or simply push illegal activities further underground remains to be seen.