Russian Bitcoin Mining Giant BitRiver Placed Under Bankruptcy Supervision as CEO Faces House Arrest

MOSCOW—The global Bitcoin mining industry is navigating a perfect storm of economic pressures, from the post-halving squeeze on block rewards to crypto market volatility exacerbated by geopolitical uncertainty. For some operators, this has prompted a strategic pivot towards adjacent fields like artificial intelligence, leveraging existing infrastructure and power contracts. For Russia's largest Bitcoin miner, however, the crisis has taken a far more severe turn, culminating in bankruptcy proceedings and the house arrest of its chief executive.

A Russian arbitration court has initiated bankruptcy supervision for the parent company of BitRiver, a firm that once symbolized the country's ambitions to become a major player in industrial-scale cryptocurrency mining. The move marks a dramatic fall for a company that, according to research from the HSE Center for Electric Power, controlled over half of Russia's domestic Bitcoin mining market with a network of data centers boasting a combined capacity of 533 megawatts.

The immediate trigger for the court's intervention was a petition from Infrastructure of Siberia, part of the energy conglomerate En+ Group. The utility firm sought bankruptcy after a failed equipment supply deal, in which it paid over 700 million rubles (approx. $9.1 million) upfront for mining hardware that never materialized. Although courts ruled in En+'s favor earlier this year, attempts to recover the funds were unsuccessful, leading to the bankruptcy filing. Subsequent asset freezes have brought BitRiver's operations to a near standstill.

This dispute is merely the tip of the iceberg. BitRiver is buckling under the weight of mounting debts, primarily to regional energy suppliers. Courts are currently reviewing claims totaling more than 940 million rubles ($12.2 million) from various utility companies. Internally, the situation has deteriorated rapidly: widespread layoffs, unpaid salaries, and a mass exodus of senior management have left the company hollowed out.

Compounding the corporate collapse, BitRiver's founder and CEO, Igor Runets, now faces criminal charges. The Zamoskvoretsky District Court placed him under house arrest on January 31, following allegations of large-scale tax evasion under Article 199.2 of Russia's criminal code. Authorities have released few details, but the charges add a severe personal legal dimension to the company's financial unraveling.

Analyst Perspective: "This isn't just a business failure; it's a case study in the systemic risks facing crypto mining in regulated, high-energy-cost environments," says Mikhail Volkov, a financial analyst based in Moscow. "BitRiver expanded aggressively on the assumption of stable, cheap power and regulatory ambiguity. That foundation has completely crumbled."

Industry Reaction: "It's a devastating blow for the sector's credibility in Russia," comments Anya Petrova, a blockchain consultant. "It will force a major reassessment of operational and financial risk management for every other player."

Sharp Critique: "Where was the oversight?" demands Dmitri Sokolov, a vocal critic of the crypto industry. "This was a house of cards built on debt and speculative hype. The CEO is under arrest, the lights are off, and ordinary creditors and employees are left holding the bag. It's a predictable fiasco that exposes the fragility of this entire mining model."

This report includes background and analysis based on original reporting from Kommersant and TASS. A version of this story first appeared in TheStreet on Feb 2, 2026.