BitRiver Founder Detained in Russia Amid $12.5M Fraud and Insolvency Claims

Woofun AI reports that Igor Runets, founder of BitRiver, has been transferred to a pretrial detention facility to face trial for 'large-scale' fraud, . The core allegation centers on his failure to deliver equipment to Infrastructure of Siberia, a subsidiary of the multibillion-dollar corporation En+. This legal escalation marks a significant downturn for the crypto mining pioneer, who was previously under house arrest.

The deeper driver of the current charges is an alleged damage exceeding 1 billion rubles ($12.5 million) caused by unfulfilled contractual obligations. Per Woofun AI, investigators assert that in 2023, Runets entered into an equipment supply contract valued at $8 million which he never completed. The counterparty, Infrastructure of Siberia, is part of En+, a major industrial player that produces 5% of the world's aluminum while managing digital and crypto mining infrastructure projects.

Structurally, Runets’ operational history contrasts sharply with his current legal status. A Stanford University MBA graduate, he founded BitRiver in 2017 and began constructing a crypto mining data center in Siberia that same year. He subsequently expanded the network to 15 data centers housing more than 175,000 servers.

However, financial strain emerged after a six-year government ban on crypto mining across 10 regions forced the closure of several facilities, leading to his February detention on three separate tax evasion charges.

The corporate fallout extends beyond the founder’s personal liberty. A regional arbitration court initiated insolvency proceedings against Group of Companies Fox, the entity that owns 98% of BitRiver’s authorized capital. These proceedings were opened in February, coinciding with the initial tax-related detention.