Russia Proposes New Laws to Seize Crypto Assets from Illegal Miners

TLDR

Russia’s Ministry of Digital Development proposes new laws allowing courts to confiscate cryptocurrencies from illegal miners Individual miners face fines of 100,000-200,000 rubles ($1,270-$2,540), while companies could pay 1-2 million rubles ($12,730-$25,455) Mining infrastructure operators must report activities to Rosfinmonitoring or face penalties Current law allows home mining under 6,000 kWh per month, but about 10 regions have tighter restrictions New rules would make serious mining violations criminal offenses rather than administrative ones

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Russia’s government is preparing to implement strict new penalties for unauthorized cryptocurrency mining operations. The Ministry of Digital Development, Communications, and Mass Media has drafted legislation that would give courts the power to seize digital assets from illegal miners.

The proposed rules are currently under interdepartmental review. If approved, they would transform how Russia handles crypto-related violations across the country.

Individual miners operating without proper registration could face fines between 100,000 and 200,000 rubles. This equals approximately $1,270 to $2,540 at current exchange rates.

Source: Blockchain.com

Solo operators and officials would see doubled penalties. Their fines could reach 200,000 to 400,000 rubles, or $2,540 to $5,090.

Companies running illegal mining operations would face the heaviest penalties. Corporate violators could pay between 1 million and 2 million rubles, roughly $12,730 to $25,455.

The draft legislation grants judges authority to confiscate cryptocurrency assets from unauthorized miners. This power would apply to both individual miners in illegal pools and larger industrial operations.

Asset Seizure Powers

Courts would gain the ability to seize digital coins from anyone mining off the books. The Central Bank views asset confiscation as the strongest deterrent against unauthorized crypto activity.

Andrey Medvedev, the bank’s Legal Department lead, stated last month that confiscating illegally used crypto would be “the most painful thing” for violators. Officials believe this threat will effectively discourage unauthorized mining activities.

Current Russian law permits unregistered individuals to mine cryptocurrency at home. They must keep their energy consumption below 6,000 kilowatt-hours per month to remain compliant.

About ten regions already have tighter restrictions in place. These areas include some territories under Russian control where mining faces additional limitations.

Reporting Requirements

The proposed rules would require mining infrastructure operators to report their activities. Data centers and crypto mining hosting providers must disclose information to Rosfinmonitoring, Russia’s anti-money laundering watchdog.

These operators would need to share details about mined assets and wallet identifiers. Missing these reporting requirements could result in additional penalties, though specific fines remain unclear.

The legislation also targets crypto payments made outside the Central Bank’s approved sandbox. Violators using digital coins for regular transactions could face fines up to 1 million rubles ($12,730).

Individuals with past convictions for economic crimes or terrorism would be prohibited from mining activities. This restriction adds another layer to the country’s regulatory framework.

The ministry wants to elevate serious mining violations from administrative to criminal offenses. This change would mean offenders could face criminal records instead of just paying fines.

A government energy commission led by Deputy Prime Minister Alexander Novak recently rejected additional regional mining bans. While year-round prohibitions exist in parts of Irkutsk, similar proposals for other regions have been shelved.

The proposed legislation remains under interdepartmental review before advancing to lawmakers for final approval.

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