A Russian court transferred Igor Runets, the founder of BitRiver, the country’s largest crypto mining company, to a pre-trial detention center to face trial for fraud, Pravo.ru reported on Thursday.
According to the news service, Runets is accused of “large-scale” fraud. Investigators allege that he caused damages exceeding 1 billion rubles ($12.5 million) by failing to deliver equipment to Siberian Infrastructure, a subsidiary of En+, a multibillion-dollar corporation that produces 5% of the world’s aluminum and also manages crypto mining, technology and digital infrastructure projects.
Russian law enforcement officials say that in 2023, Runets entered into an equipment supply contract worth $8 million that it never fulfilled, according to Pravo.ru.
Runets, a crypto mining pioneer in Russia, was detained and placed under house arrest in February on three counts of tax evasion. The Stanford University MBA graduate began building a crypto mining data center in Siberia in 2017, the same year he founded BitRiver. It later expanded the operation to 15 data centers with more than 175,000 servers.
Following the closure of several of its crypto mining centers due to a six-year government ban in 10 regions, BitRiver began to face financial problems. In February, a regional arbitration court opened insolvency proceedings against its majority shareholder, the Fox Group of Companies, which owns 98% of BitRiver’s authorized capital.
