Russian authorities have caught a fugitive cryptocurrency miner who ran a mobile farm in the Caucasus, evading capture for months on end.
The coin minting vehicle was eventually located using a quadrocopter equipped with a thermal camera, revealed officials from the power utility in Dagestan.
Dagestan deploys drones in war against rogue miners
Russia is now resorting to modern technologies, such as those seen on the battlefields of Ukraine, to identify makeshift mining facilities in regions where they are causing energy shortages, breakdowns and financial losses by illegally connecting to the grid.
The new approach in the intensifying crackdown on unauthorized crypto mining has been implemented in one of its republics in the North Caucasus, where the minting of digital currencies outside the law has become almost a national sport.
It took employees of Dagestan’s energy distribution company three months to track down an improvised crypto farm on wheels, announced Magomedshapi Shapiev, acting director of Dagenergo, the local branch of the Rosseti transmission network operator.
The mining hardware was installed in the cargo bay of a Gazelle van, owned by a resident of the village of Tashkapur, Levashinsky district. The man placed 72 mining rigs in the back of the converted vehicle, the official detailed, quoted by RBC Crypto and Life.ru.
Shapiev also said this is not the first time the authorities have dealt with the same person, who had a similar installation seized only about a year ago. He elaborated:
“It’s worth noting that the mining farm was discovered with the same consumer who had a similar mining farm liquidated and equipment confiscated during a control operation last year.”
Preliminary estimates suggest financial damages resulting from the clandestine mining undertaking amount to around 1.5 million Russian rubles (roughly $18,500).
The utility admitted that the van had been running on power supplied through an electricity meter, which recorded over 152,000 kWh of consumption. However, following a careful inspection, electrical engineers suspect it may have been tampered with, leading to false readings.
The fascinating part of the story is that the mining farm was discovered using a drone with night vision capabilities. The Novye Izvestia daily posted a video.
Shapiev’s subordinates started using such gadgets in the summer of this year. The cameras on the UAVs (unmanned aerial vehicles) allow them to detect mining devices running and emitting heat in attics, basements, and other places where miners hide crypto-extracting machinery.
All evidence collected from the mining Gazelle has been examined by technicians and handed over to law enforcement officers for forensic analysis.
Russia serious about ending illegal crypto mining
Magomedshapi Shapiev explicitly emphasized that the offense is aggravated by the fact that mining has been officially banned in Dagestan since the beginning of the year.
The republic is one of about a dozen Russian regions that have partially or fully prohibited mining after it became the first relatively well-regulated crypto activity in the country.
Russia legalized mining in 2024, requiring miners burning more than 6,000 kWh of electricity monthly to register with the state and pay taxes.
However, low, often subsidized electricity rates in some parts of the country attracted significant numbers of miners – legal, amateur or illegal – causing headaches for local authorities and other consumers in terms of power deficits.
Officials in these territories, from Siberia to the Caucasus, initially introduced seasonal and later permanent restrictions on mining, with the approval of the federal government in Moscow. Two more regions may soon be added to the list, as recently reported by Cryptopolitan.
According to one estimate, the Russian state is losing over $120 million a year in budget revenues from the industry, as less than a third of mining businesses have so far registered with the Federal Tax Service (FNS). Rogue miners have been threatened with fines and seizure of illegally minted cryptocurrency.
The confiscation of the mobile farm in Dagestan comes after the authorities in Irkutsk, dubbed the mining capital of Russia, dismantled one of the largest unlicensed mining installations discovered in recent months in mid-October.
