Russian state bank Promsvyazbank has filed a petition to declare Igor Runets, the founder of the country's largest cryptocurrency mining company BitRiver, bankrupt.
The bankruptcy application, submitted to the Arbitration Court of the Sverdlovsk Region, involves financial claims against the prominent crypto executive exceeding 770 million rubles.
Promsvyazbank is a major state-owned Russian commercial lender headquartered in Moscow, designated by the Russian government to handle key state financial operations. BitRiver is Russia's largest provider of data center infrastructure for cryptocurrency mining, running facilities where specialized computer servers solve complex mathematical problems to validate blockchain transactions and mint digital currencies.
Corporate dispute and insolvency proceedings
The legal move against Runets comes alongside an ongoing corporate bankruptcy case targeting Fox Group, the parent organization that includes the mining business. The corporate insolvency process began in early February when a former creditor, En+ Infrastructure of Siberia, submitted a petition that the Arbitration Court of the Sverdlovsk Region accepted as justified.
A court-appointed interim manager reviewing BitRiver's financial activities found evidence pointing to possible deliberate bankruptcy. The manager reported several serious financial irregularities, including the improper transfer of funds to affiliated companies and the replacement of liquid assets with illiquid debt obligations.
En+ is an energy and metals holding company that controls major hydroelectric power plants and regional utility networks across Siberia, where abundant electricity has historically attracted large-scale data center developers. In 2019, Fox Group and En+ established a joint venture called Bit+ to build and manage digital asset mining facilities. Fox later withdrew from the venture, igniting a bitter corporate conflict and protracted court battles between the two sides.
The corporate fallout broadened in late February when the Federal Tax Service of Russia initiated legal action against another branch of the business. The tax agency filed a bankruptcy petition in the Arbitration Court of the Republic of Buryatia against BitRiver-B, a subsidiary of BitRiver, claiming an unpaid debt of 3.6 million rubles.
Criminal fraud charges and detention
The financial collapses have unfolded alongside severe criminal inquiries against Runets himself. Law enforcement officers detained the BitRiver founder in early February on suspicion of tax evasion, taking him into custody immediately after the bankruptcy process for Fox Group was launched.
Investigators later escalated the criminal case, charging Runets with especially large-scale fraud over an equipment supply agreement with En+. Investigators stated that Fox Group, under the direction of Runets, received an advance payment of $7.9 million to procure specialized crypto mining equipment, but never supplied the machinery and failed to refund the funds.
A court originally placed Runets under house arrest following his initial detention. Authorities then transferred him to a pre-trial detention facility in July after leveling new fraud charges involving an additional 1 billion rubles. Pre-trial detention centers in Russia, known as SIZO facilities, hold suspects under strict remand conditions while law enforcement conducts ongoing criminal investigations.
