Russia Proposes Heavy Fines and Prison Sentences for Illegal Crypto Mining Operations

• Russia plans fines and prison for illegal crypto miners to enforce registration and tax rules.

• Over 1000 miners are registered but many still operate illegally risking severe penalties.

• New laws ban foreign mining and require monthly reporting to monitor energy and tax compliance.

Russia is shifting towards cracking down on unregistered cryptocurrency mining. The Ministry of Justice proposed a draft bill, which defines fines and jail sentences. The government seeks to control an industry that is much beyond the tax bracket.

Russia Proposes Tough Penalties, Prison for Illegal Crypto Mining

• Russia legalized crypto mining in late 2024 but miners had to register with the government.

• Now the Ministry of Justice has put forward a draft law that goes much deeper criminal penalties for people or…

— Trippie (@Trip_jayX) December 30, 2025

The proposed amendment will apply to miners who are not registered with the Federal Tax Service. The punishments encompass a fine of 1.5 million rubles and up to two years of forced labor. Operations that make above normal profits may be slapped with heavier penalties such as imprisonment of 5 years. Fines of up to 2.5 million rubles are applied to coordinated groups or large-scale operations. Officials could also give joint jail and financial fines.

Registration and Tax Requirements for Miners

All miners must now register with the Federal Tax Service and report monthly earnings. Individuals consuming less than 6,000 kWh per month are considered private miners. They still need to pay personal income tax on mined cryptocurrency.

By October 2025, about 20 million Russians used cryptocurrencies and more than 1,000 miners were registered. The infrastructure operators are also expected to register and report operations. The government is determined to promote compliance and track cryptocurrency production in the country.

Monitoring Equipment and Illegal Operations

The Ministry of Energy introduced a registry to track mining equipment in July 2025. The system is used by officials to identify unregistered miners and track the high-activity areas. Officials stepped up their efforts following uneven power consumption that covered unlawful mining farms.

In October, a facility illegally operating in St. Petersburg since 2018 was raided by the police. Over 2,700 mining rigs were seized. The Ministry of internal affairs examines anomalies in power that are associated with illegal operations. These measures aim to curb tax evasion and reduce energy abuse.

Legal Framework and Restrictions

On November 1, 2024, the process of crypto mining was made legal in Russia. New regulations entail mandatory registration and reporting monthly. Foreign entities are prohibited from mining within Russian territory. Authorities can restrict mining in specific regions, ensuring compliance with energy and tax regulations. Russia maintains that the ruble remains the only legal payment currency. Additionally, Russian exchanges revealed plans to launch regulated crypto trading by mid 2026 under new laws.

Digital currency may be used for trading or investment but cannot replace ruble payments domestically. According to lawmakers, these regulations save the economy and help to avoid financial risks. The Deputy Prime Minister Alexander Novak announced that the criminal liability towards illegal mining and lending will start in 2026.