The fight against illegal mining in Svaneti is reaching a new level. After the Svans, who had sworn on an icon not to mine, broke their four-year vow, the state has stepped in to tackle the issue.
On June 1, State Minister for the Coordination of Law Enforcement Agencies Mamuka Mdinaradze announced a major crackdown on the illegal business, which is damaging the country’s energy sector. The central theme of Mdinaradze’s speech was the proliferation of mining farms in Svaneti, which overload grids and power lines, lead to power outages, cause inconvenience to the local population, and harm the tourism sector.
Over the course of two weeks, Georgia’s Ministry of Internal Affairs conducted several raids and reported the seizure of more than 300 cryptocurrency mining devices. The operation is ongoing, and the investigation is being conducted under a legal provision that carries a sentence of up to three years in prison. At the same time, the installation of so-called “smart meters” has begun in Svaneti. Any electricity consumed above the allowance will have to be paid for at the standard tariff.
This is because, under a government program, residents of this remote region receive electricity free of charge. The resulting bill is distributed among other consumers across Georgia. This creates a highly favorable environment for miners. Mining rigs require a massive amount of electricity; just a single device can consume more electricity than several apartments combined. If bills were paid honestly, the business would not be profitable.
This issue has been the subject of several journalistic investigations in the past. It was revealed that major players set up their farms in ordinary Svan households for a nominal fee of just a couple of dollars a day. Mining devices were found even on church grounds and in the home of a police officer in the village of Khaishi.
Interestingly, according to journalists, local residents know exactly where the farms are located but do not disclose this information for fear of ruining relations with their neighbors. And although the authorities have tried to combat cryptocurrency mining in the region in the past, major players always remained untouched—according to observers, thanks to high-level patrons. Unsurprisingly, past raids had no impact on the figures.
According to official data, the situation in Svaneti has spiraled out of control over the last five years. While the region consumed 91 million kilowatt-hours of electricity per year in 2020, by 2025 this figure had risen to 133 million. State losses have exceeded tens of millions of lari, leaving Tbilisi with simply no choice, experts note. This is especially true given that the country’s key tourism sector has come under threat.