Russian Authorities Uncover Illegal Crypto Mining Operation in Daghestan

Russian authorities dismantled a sizable illegal crypto mining operation on trucks in Daghestan, causing significant power disruptions to the local community.

The crackdown highlights the ongoing struggle with illegal crypto mining in rural Russia, prompting further regulatory scrutiny and regional energy strategy adjustments.

Illegal Mining Rigs on Trucks Cause Power Outages

The operation involved mobile crypto mining rigs stationed on trucks, significantly impacting the local power supply in Daghestan. Regional energy authorities, led by the Ministry of Energy, identified and successfully shut down the operation. Their methods included innovative detection strategies.

Authorities discovered illegal operations draining substantial electrical energy, equivalent to powering 1,500 homes. Techniques employed involved temporary internet shutdowns to monitor power load drops, which helped pinpoint non-compliant activities.

“After the internet was switched off, power consumption dropped by 3.2 MW, equivalent to the operation of approximately 900 mining rigs… This is the reason for the low voltage and frequent power outages.” – Magomed Gadzhiev, Official, Daghestan Energy Sector

Crypto Mining Ban Imposed Ahead of 2025 Commencement

Illegal crypto mining contributed to over ₽350 million in financial losses for the local energy sector. Daghestan enforced a crypto mining ban effective January 2025 to prevent future occurrences. Wider powers in the regional energy infrastructure were affected.

This situation highlights the need for stronger regulatory measures to tackle unauthorized mining. Regional energy providers are expected to continue refining techniques to detect and prevent future illegal activities. The broader crypto market showed stability, despite local challenges.

Daghestan’s Recurring Struggles with Crypto Mining Raids

Daghestan’s history with illegal crypto mining is well-documented, including a January 2025 operation that seized 169 rigs. These repetitive occurrences have historically caused local disruptions and spurred regulatory adjustments but have not significantly impacted the global market.

Experts suggest enhanced regulation and vigilant monitoring may mitigate future risks. Insights from prior events suggest regulatory responses can create structured market environments, reducing illegal activities. Such measures are vital for sustaining regional grid stability and economic balance.

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