More Siberian regions are cracking down on home crypto miners, with Novosibirsk law enforcers announcing the arrest of a resident of the Russian city.
The Novosibirsk-based media outlet NGS reported that “security forces” believed the unnamed man had committed a form of electricity fraud.
Home Crypto Miners in Crosshairs
Kirill Travin, the Deputy Head of the Novosibirsk Oblast’s branch of the Ministry of Internal Affairs, told attendees about the arrest at a meeting with Governor Andrei Travnikov.
Travin said officers raided a property in the region’s northeastern Moshkovsky District, where they discovered “six administrative violations.”
A crypto mining “farm” in Irkutsk, Siberia. (Source: Vasily Vishaev/Dzen/Screenshot)They arrested a man and launched a criminal case, Travin explained. The official added that police were also looking into details of “another [potential] violation.”
Travin added that the man had “managed to earn 12 million rubles [over $123,000]” from his mining operations.
The official did not state which coin the man had mined, but posters on a local forum claimed the resident had been caught mining Ethereum (ETH).
“The man was mining using regional power grid equipment to create cryptocurrency in the Moshkovsky District. He mined [coins worth] over 12 million rubles.”
Kirill Travin, Deputy Head of the Novosibirsk Oblast’s branch of the Ministry of Internal AffairsResident: I Think Lots of People Mine Crypto in Novosibirsk
Sasha (surname withheld at interviewee’s request) is a Novosibirsk resident who spoke to Cryptonews.com on October 28. He explained:
“I believe a lot of people are mining crypto from home in our city. There are apartments with rooms where the windows are always open, even in the dead of winter. Even in my apartment block, I hear strange whirring noises coming from a room not far away.”
Home-based crypto mining is not technically illegal in Russia. Recent legislation has – in fact – legalized “private” mining in Russia.
Inside a Russian crypto mining “hotel.” (Source: Urals Mining Company/YouTube/Screenshot)However, the new law obliges home-based miners to abide by local power providers’ electricity caps.
Regions will also be able to order all miners in their jurisdictions to shut off their rigs as of November 1, after President Vladimir Putin signed the nation’s second crypto mining law earlier this month.
Average Bitcoin mining difficulty over the past 12 months [T = Time Previous / 2016 x 10 min]. (Source: Messari)The bill is the second crypto mining-related law to pass the State Duma in the space of the second half of the year.
However, the law appears to contain several blind spots that have left small-scale Russian miners confused.
The Novosibirsk resident appears to have been arrested for using subsidized electricity to power his rigs.
Inside a Russian crypto mining “hotel.” (Source: Urals Mining Company/YouTube/Screenshot)However, home-based miners generally have no access to commercial power. Lawmakers appear keen to return to the matter of “private crypto mining” in future legislation.
Power Companies Step up Their Hunt
Power engineers in the region have been hunting crypto miners with a growing intensity this year.
NGS reported that officials have found “illegal” crypto mining “farms” all over Novosibirsk: near a sewage treatment plant, outside a city refuse dump, in forested areas, and in residential spaces.
The crackdown comes as police conduct similar purges in other parts of Siberia. These include the Bitcoin mining hotspot of Irkutsk and the neighboring Republic of Buryatia.
Cryptonews.com has also seen videos of Russian miners in Siberia showcasing “mobile crypto mining farms” they claim to operate from vans and cars.
Miners appear to be using these setups to evade detection from power providers and police officials.
In Moscow, meanwhile, politicians are drafting plans to start taxing industrial crypto miners.
Industry officials say that this will help bring hundreds of millions of USD to the Russian Treasury every year.
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