Illegal Cryptocurrency mining activities are being cracked down upon by regulators all across the globe. A major Russian mining firm has recently been accused of fraud in St. Petersburg and is now set to face a trial after a city court issued a criminal case order during the week.
According to local news publisher RBC, the St. Petersburg City Court has accepted the appeal of three of the firm’s customers to send the case to trial. Cryptouniverse, the bitcoin and Litecoin mining firm previously made headlines in August 2020 after Businessman Alexei Burik started a legal initiative, alleging that the firm embezzled his crypto mining equipment and his mined coins worth 25 million rubles ($340,000).
Back then, the Kuibyshevsky District Court rejected the decision of law enforcement to launch an investigation for fraud after the mining firm filed an appeal. However, now that the court has accepted the plea, the case is targeting Mikhail Kvasnikov, general director of Cryptouniverse, with a 60% stake in the company.
Some experts have noted that cases of this sort against crypto mining farms are mostly related to sudden changes in equipment usage’s terms and conditions. These changes are not in favor of the customers most of the time.
However, in this scenario, the trade union of crypto miners in Russia is stating that the expensive costs of installing crypto-mining rigs in homes are the reason why people are forced indirectly to rely on mining data centers.
Maxim Nikolaev, coordinator of the trade union of crypto miners in Russia adds that the lack of regulations surrounding the digital currency mining industry is what is triggering legal cases like this with mining firms.
The lack of regulations is also hurting the revenue of crypto mining companies according to some experts.
Tightening Crypto Laws
Meanwhile, the Russian government continues to tighten laws that govern cryptocurrencies. Earlier this year, President Vladimir Putin signed a new order which required all public officials to declare any cryptocurrency holdings and digital assets from Jan. 1, 2021. The order was passed as a part of the nation’s law “On Digital Financial Assets,” or DFA, which was made effective on Jan. 1.