Georgia is moving to crack down on illegal Bitcoin mining in the Mestia region, with officials citing severe strain on the local power grid and millions of dollars in annual losses.
The scale of the problem
Vice Prime Minister Mamuka Mdinaradze announced Monday that illegal mining had pushed Mestia’s electricity consumption to 133 million kilowatt-hours in 2025.
That figure is more than 13 times the roughly 10 million kilowatt-hours typical for comparable municipalities.
The excess consumption translated into financial damages of 20–25 million lari, or up to $9.4 million annually, according to Mdinaradze.
Large-scale illegal operations have caused grid overloads and repeated outages, affecting both residents and tourists in the region.
Metering and enforcement
Authorities plan to install electricity meters across villages and settlements throughout Mestia to pinpoint the exact sources of illegal activity.
Law enforcement agencies have also been tasked with identifying and shutting down unlicensed operations.
Mdinaradze stressed that electricity in Svaneti will remain free for ordinary consumers up to a set threshold, and that the new measures are targeted solely at illegal mining operations.
Why Georgia attracts miners
Georgia has long been a draw for Bitcoin miners due to cheap hydropower from the Caucasus Mountains, low electricity costs, and favorable tax treatment, including free industrial zones and VAT exemptions on certain crypto-related activities.
Bitfury was among the first major companies to establish a presence there, building a 20-megawatt Bitcoin mining facility known as the Gori Data Center back in 2014.
The Georgian government has not yet confirmed what sanctions apply to illegal mining or whether operators will be offered a licensing pathway to legitimize their activities.
