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Abkhazia Plans to Criminalize Crypto Mining as Energy Crisis Deepens— Extends Temporary Ban

Mining of cryptocurrency in Abkhazia is still a hot potato for the de facto state government, which is now determined to criminalize such activities. Continuous massive power disruptions, in parallel, are fueling the anger of the people towards crypto miners.

Public Officials to Face Bigger Penalties

According to a report published by E Daily, the Abkhazian government revealed that it’s due to present a proposal to fine miners and also file criminal charges against them.

The plan is to set fines up to $8,000, which is a considerable amount of money, as it is the same yearly average income per individual in the de facto South Caucasus state, equal to 20 minimum national wages.

But such punishments are the lowest ones considered in the proposal.

In fact, the government seeks to hit back with even more significant penalties against public servants who are caught in crypto mining activities, as well as companies running rigs, with up to 5,000 minimum national wages.

However, the report detailed the punishments that could face people, public officials, or businesses for “repeated offenses” in regards to crypto mining activities:

For repeated committing of an administrative offense shall entail the imposition of an administrative fine on individual entrepreneurs, legal entities and citizens in the amount of 50 minimum wages for each kilowatt of power of the equipment connected to power grids for carrying out activities for the extraction of cryptocurrencies, with the confiscation of said equipment, on officials – in the amount of 5,000 minimum wages.

Anyone who attempts to connect mining rigs on power grids to a large-scale farm in Abkhazia could face a jail time of one to three years, together with the seizing of the equipment.

Government Extended Again Its ‘Temporary Ban’ on Crypto Mining

The government also published a decree which extended its “temporary ban” on crypto mining until, at least, March 31, 2022. As News reported in October 2020, Abkhazia lifted its two-year ban on cryptocurrency mining.

The ban came into effect in December 2018 after a surge in mining activity left the region facing an energy crisis. But the latest news supposed a turnaround in the last year’s ban lifting.

Moreover, in December 2020, the burnout of a power substation provoked a massive blackout across the de facto South Caucasus state. The situation happened amid the refusal of crypto miners to slow down their operations in the state.



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