In St. Petersburg, prosecutors have accused a senior Russian Railways official of running a large-scale electricity theft to fuel crypto currency mining. At the center is the Rail Boss who allegedly ‘stole electricity from Russian Railways Network to mine crypto’, a scandal that merges corruption, technology, and crime. The case has sparked debate over how unregulated mining exploits public resources and challenges state oversight.
How the Scheme Was Uncovered
Investigators claim Sergei Kuznetsov, head of the St. Petersburg-Finlyandsky Station Electricity Supply Department, along with his deputy Nikolai Baltser, orchestrated the plan. Mining rigs were allegedly installed at two substations—Gromovo and Lugovaya—connected directly to the railway grid.
These machines consumed massive amounts of electricity without authorization, allowing private digital profits to be generated at the expense of state-owned infrastructure.
Enormous Losses and Legal Fallout
Authorities estimate the stolen power to be worth 1 billion rubles (over US$12 million). Beyond the financial impact, prosecutors say the case exposes a deep misuse of authority and public trust.
Both officials now face charges of abuse of power and large-scale property damage. If found guilty, they could face heavy prison sentences and fines, while Russian Railways suffers reputational damage from the scandal.
Timeline of the Hidden Operation
According to court filings, the illegal mining started on September 16, 2024. For a year, the operation went unnoticed, running until September 16, 2025, when abnormal energy consumption revealed the setup.
Officials argue that the suspects knowingly ignored the risks their actions posed to the railway’s power infrastructure, making this a deliberate act of exploitation rather than negligence.
Search for the Real Mastermind
Prosecutors suggest Kuznetsov and Baltser may not have acted alone. Evidence points toward an unidentified mastermind, possibly another insider, who coordinated the technical and logistical aspects of the scheme.
Reports indicate that Kuznetsov has agreed to cooperate with investigators, while Baltser continues to deny wrongdoing. Authorities warn that additional arrests may follow.
Crypto Mining in Russia on the Rise
The scandal reflects broader shifts in Russia’s mining landscape. Once concentrated in regions with cheap energy like Siberia, mining is now spreading into major cities, including St. Petersburg.
Experts caution that such unregulated setups increase risks for the energy grid and create opportunities for corruption. The case of the Rail Boss who ‘stole electricity from Russian Railways Network to mine crypto’ is being viewed as a warning sign of these challenges.
Final Thoughts
This case illustrates how unregulated crypto mining can compromise national infrastructure, fuel corruption, and damage public trust. The Rail Boss who ‘stole electricity from Russian Railways Network to mine crypto’ has become a symbol of how quickly personal greed can undermine vital state systems.
On a global level, the case highlights the darker side of digital finance and energy-intensive technologies. While crypto represents innovation and opportunity, it also demands responsibility. If nations fail to balance progress with oversight, the risks of fraud, theft, and resource abuse will only grow. This scandal is not just about one official—it is a reminder of the urgent need for transparency, governance, and sustainable energy practices in the crypto industry.
