Russia’s tax authority is now submitting for chapter of a BitRiver subsidiary chargeable for a large, failed challenge believed to have led to the downfall of the troubled mining large.
Chapter proceedings have been initiated within the Republic of Buryatia, which is residence to a 100 MW knowledge heart constructed by the corporate, however was by no means put into operation amid mining restrictions and mounting debt.
BitRiver firm faces chapter proceedings in Buryatia
Russia’s Federal Tax Service, FNS, filed a chapter petition in opposition to the BitRiver-B entity, a part of the BitRiver crypto mining group, with the Arbitration Court docket of the Republic of Buryatia, media reviews revealed.
On the coronary heart of the case is a failed multi-million greenback funding by the mining large within the area. Some say it’s the mistake that led to the corporate’s monetary pressure and subsequent issues with the state, together with the current arrest of its CEO.
Based on the regional information outlet “Quantity One”, which was the primary to study concerning the court docket file, the challenge to construct a 100 MW knowledge processing heart (DPC) within the Mukhorshibirsky district of the Far Jap territory was first introduced in 2020.
The native subsidiary, integrated within the rural administrative heart of Mukhorshibir with a registered capital of 100,000 rubles, was created to implement the bold challenge, initiated by BitRiver’s personal founder and CEO, Igor Runets.
Development started in 2022, with a deliberate launch for the second half of 2024 that by no means materialized. As of February 2024, BitRiver had invested 1.4 billion rubles (greater than $18 million) within the facility, in keeping with enterprise information portal RBC.
The positioning was meant to accommodate highly effective gear for large knowledge processing, digital forex mining and cloud computing, and was purported to create 100 jobs within the space. Nevertheless, the completion of the challenge coincided with the extension of restrictions on coin minting on this a part of Siberia.
In spring 2025, the DPC was reported prepared to start operations, however as a repurposed facility to fulfill the wants of synthetic intelligence (AI) purposes. In January 2026, Russian authorities imposed a whole ban on Bitcoin mining in Buryatia for the subsequent 5 years.
Failed mining challenge blamed for BitRiver woes
Sources accustomed to these developments declare that the failure of the information heart challenge in Buryatia dealt a extreme blow to the Russian mining large.
Quoted by RBC, they stated the group may by no means get well and was ultimately compelled to cease mining operations elsewhere as nicely.
This occurred amid mass worker departures and rising lawsuits filed by contractors and power suppliers in opposition to their entities.
BitRiver was established in 2017 and has since turn into Russia’s largest crypto mining farm operator and the nation’s main importer of mining {hardware}.
Founder Igor Runets was accused of tax evasion in late January, detained and positioned below home arrest. One of many calls for of Russian prosecutors was that their firms pay the salaries owed.
Russian media reviews within the following weeks detailed a tax evasion scheme allegedly carried out by mining firms within the nation.
Commenting on the BitRiver case, the chairman of the parliamentary Power Committee, Nikolai Shulginov, accused Russian miners of hiding cryptocurrency-related earnings by formally utilizing the identical gear to offer different companies that require computing units.
Russia legalized the minting of digital currencies in 2024, requiring these engaged within the exercise to register with the FNS and pay the corresponding taxes. Nevertheless, in keeping with authorities estimates, solely a 3rd of identified mining firms have executed so thus far.
BitRiver’s income for that 12 months exceeded 10 billion rubles (round $130 million), serving to the group to high the Russian rating of mining firms in 2025, forward of Intelion Information, which lately took out Russia’s first mortgage utilizing cryptocurrencies as collateral.
