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Malaysian Crypto Miners Caught Stealing $59,700 of Electricity from State on Monthly Basis

Malaysian police recently arrested five cryptocurrency mining operators that were caught stealing electricity from a state-owned power firm, Sarawak Energy Berhad (SEB).

Officials Crack Down on Cryptocurrency Mining Operations

During a joint inspection put together by SEB, Malaysian police and the Electrical Inspectorate Unit (EIU) – a department operating under Sarawak Ministry of Utilities – discovered the illicit activities. The operation had been running for quite a while and was reported to be coordinated from four shophouses that served as headquarters for the criminal cryptocurrency mining operators.

The SEB and the EIU spent two days cracking down on the locations, which were found to be situated in Jalan Tun Ahmad Zaidi Adruce, Jalan Pahlawan, and Jalan Tunku Abdul Rahman.

According to a report released by the Electrical Inspectorate Unit, Malaysian officials believed that the deviant crypto miners masked their operation by bypassing the energy meters installed in the power firm to measure electricity consumption. The report provided further explanations:

“It was found that unsafe direct tapping cables from the main incoming supply were hidden in the gypsum ceiling that were connected straight to the electrical appliances, bypassing the meter and avoiding actual electricity consumption measurements.”

Malaysian police reported that all 5 crypto mining premises generated RM 250,000 worth of electricity per month, which translates to roughly $59,000.

However, the add-up of the monthly electricity bills for all 5 shophouses amounted to approximately $215 per month, suggesting that the crypto mining operators were also cheating local energy meters in order to cover up their main electricity theft operation.

According to Malay Mail, the crypto operators had been conducting electricity theft for quite some time, with the EIU and SEB tracking and investigating them since 2018. Over this 2-year gap, 50 electricity theft cases originating from these crypto mining operators had been uncovered.

The cryptocurrency mining operators and their criminal cases are currently pending prosecution by Sarawak State Attorney-General’s Chambers.

Illegal Crypto Mining Farm in Kyrgyzstan

Recently, another illegal cryptocurrency mining farm trying to gain electricity supply through illicit means was also uncovered.

This mining operation was discovered to be run in Kyrgyzstan, on the territory of Bishkek Free Economic Zone. The mining farm was set up there purposely to take advantage of the cheap electricity offered by the country.

Iranian Power Plants to Supply Surplus Power to Bitcoin and Crypto Mining Farms

As the Iranian government has maintained that cryptocurrency mining operations are legal, power plants in the country are considering increasing their sources of income by supplying surplus electricity to Bitcoin and cryptocurrency mining farms.

Per reports from the Tehran Times, the Iranian Thermal Power Plant Holding Company (TPPH) is drawing on the announcement of the nation’s Energy Ministry that power plants are permitted to mine cryptocurrencies to sell excess power from three of its power plants to miners.

According to the head of the TPPH, Mohsen Tarztalab, “The Necessary equipment has been installed in three power plants of Ramin, Neka, and Shahid Montazeri, and the auction documents will be uploaded on the SetadIran.ir website in the near future.”

Tarztalab recounted that the decision of the TPPH to delve into cryptocurrency mining stems from the constant price hikes from the energy ministry as well as the need to supply electricity to consumers at stable prices which have largely affected revenues. Tarztalab said that the supply of electricity to miners is a way to fill in the gap in its plummeting revenues.

As Tarztalab further noted, the TPPH is only going to use the power plants’ expansion turbines for the mentioned purpose because they do not consume liquid fuels like gas oil, and only natural gas, which is cleaner, is used as fuel in these turbines. The TPPH is reportedly set to comply with the regulatory guidelines and tariffs applicable to players in the cryptocurrency mining sector.

Iranian’s Grant to Power Plants is to Boost the Economy

The position of the Iranian government to permit power plants in the country to mine cryptocurrencies is hinged at helping to inject liquidity into the economy which can have a positive bearing on economic growth.

The entire disposition of the Iranian government to stay bullish on cryptocurrencies may have a bearing on the need to bypass sanctions as advocated by Iranian Commander, Saeed Muhammad. Nonetheless, the improved trend in crypto transactions by Iranian citizens and businesses will help to generate new income streams as argued by Tarztalab.

Image source: blockchain.news

Kyrgyzstan Government Increases Electricity Tariff for Crypto Miners

The authorities in Kyrgyzstan recently revised their Medium-Term Tariff Policy (MTTP) for electricity and heating, leading to power tariffs in the nation for cryptocurrency mining increase by 12.5%.

The authorities have made such decisions due to the huge energy consumption required in the cryptocurrency mining process. The administration announced the Medium-Term Tariff Policy for Electricity (2021-2025) on September 30 after being proved by the cabinet of ministers.

Kyrgyz government recently updated electricity tariffs involving different groups of consumers based on their needs. The officials listed cryptocurrency mining activities as major power consumers alongside the alcoholic beverage’s manufacturing industry and gold mining.

Surely, the Kyrgyz government seeks to ensure the power sector’s sustainable and stable function with the aforementioned measures.

The authorities will implement a set of the following regulations concerning electricity rates of cryptocurrency mining. Firstly, Kyrgyz authorities have categorized mining firms or cryptocurrency firms as one of the 14 groups put into consideration in the revision scheme.

Cryptocurrency miners will be charged 2.52 Kyrgyzstani som or about $0.03 for each kilowatt-hour of electricity consumed. The authorities will adjust prices every year to reflect the average annual inflation level in the four years during 2021-2015, covered under the new tariff policy.

Lastly, the officials will update the revised tariffs based on the additional operating costs of the country’s thermal power plants and distribution costs.

The revised tariff comes into effect after Kyrgyzstan’s Ministry of Economics announced the need to impose a 15% tax on the cost of electricity consumed to mine cryptocurrencies in August 2020.

Kyrgyz Attracting Miners

After China banned cryptocurrency mining earlier this year, Kyrgyzstan has become one of the hotspots for the mining pools.

Since Kyrgyzstan is an attractive mining destination, cryptocurrency mining has become one of the causes of the energy crisis in the region.

The latest statistics by the World Bank shows that the population’s access to electricity in the country had fallen in 2019 when compared to 2017 and 2018. The consumption of energy per year for Kyrgyzstan is around 10.52 bn kWh.

As a result, Kyrgyzstan is making efforts to regulate the cryptocurrency sector. Last year, the National Bank of the Kyrgyz Republic introduced licensing requirements for crypto exchanges to protect local investors.

In August, Kyrgyzstan’s State Service for Regulation and Supervision of Financial Markets introduced a new regulatory framework to give legal status to crypt exchange. Authorities have also put forward a draft proposal seeking to regulate cryptocurrency exchanges so that to comply with existing ALC (anti-money laundering compliance) /CFT (combating the financing of terrorism) measures. The new framework is also speculated that will generate new income sources for the nation’s national budget.

Kosovo Imposes Ban on Crypto Mining After Facing Electricity Crisis

Cryptocurrency miners in Kosovo are facing a temporary ban on crypto mining from the government to curb electricity consumption as the country faces a severe energy crisis.

The country has reported seeing the worst energy crisis in a decade due to production outages.

“All law enforcement agencies will stop the production of this activity in cooperation with other relevant institutions that will identify the locations where there is cryptocurrency production,” Economy and Energy Minister Artane Rizvanolli said in a statement.

Rizvanolli acted on the advice of the Technical Committee for Emergency Measures in Energy Supply on December 31, 2021, as part of a set of relief measures.

Prior to the ban, the eastern European country had seen an increasing number of young people who got involved in crypto mining due to cheap power prices in the country.

Unfortunately, authorities were forced last month to introduce power cuts due to coal-fired power plant outages and high import prices.

One miner, who spoke on condition of anonymity and got 40 GPUs (Graphics Processing Units), told Reuters he was paying around 170 euros per month for electricity and is getting approximately 2,400 euros per month in profit from mining.

According to a report by the Gazeta Express, the government declared a state of emergency in December, lasting for 60 days, allowing it to allocate more money for energy imports and introduce power cuts.

The country of 1.8 million people is now importing more than 40% of its consumed energy with high demand during the winter.

The move to ban crypto mining is similar to Iran’s measure on December 28. Iran announced that it will ban all crypto mining activities until March 6 to save power and avoid blackouts over the winter.

According to a December 28, 2021, report by Blockchain.News. The Iran Grid Management Company, also known as the Tavanir, cut off the power supply to licensed cryptocurrency miners, a significant step against its backing for the controversial adventure.

However, the motive behind this move is understandable as energy conservation amidst decreasing temperatures is a top priority, local Iribnews reported citing Mostafa Rajabi Mashhadi, chairman of the board and managing director of the Tanavir.

British Columbia Will Stop Crypto Miners From Getting Electricity

An electric utility company in the Canadian province of British Columbia, which is controlled by the state, has announced that it intends to put a temporary stop for the next 18 months to any new requests for electrical connections that are made by cryptocurrency miners. This plan is being carried out in order to save money.In a statement that was made public on December 21, the British Columbian government broke the news in an announcement that they had issued. According to the statement, the pause will provide the government and BC Hydro with the opportunity to develop a permanent framework that is capable of better balancing the requirements of cryptocurrency miners with those of the residents and businesses in the region. This is something that has been explained as being possible as a result of the pause.Seven bitcoin mining plants are now connected to the grid that is maintained by BC Hydro.It is not expected that these six additional wind farms, which have a total capacity of 273 megawatts when combined, will be damaged in any way by the outage.On the other hand, new cryptocurrency mining projects will not be able to begin the process of connecting with BC Hydro, and projects that are already in the early stages of the connection procedure would also have their progress paused, according to what was mentioned. Additionally, it was mentioned that there are already 21 cryptocurrency mining projects that have asked for a combined total of 1,403 megawatts of electricity to run their operations.According to the information that was provided by the Ministry, this quantity of electricity is equal to the amount that would be required to power around 570,000 households or 2.1 million electric automobiles in the province on an annual basis.The British Columbia hydro and electricity authority released a paper with the title “Crypto dilemma” in the month of December 2022. In the report, the authority issued a warning that an unprecedented amount of requests for cryptocurrency mining operations might potentially strain the existing energy supply and lead to higher electricity costs for inhabitants of the province of British Columbia.Proof-of-work (PoW) mining is now prohibited in the state of New York, making it the first state in the United States to implement such a ban. The implementation of any new mining activities that are not completely powered by renewable energy sources is expressly prohibited under this rule.

Former facilities worker who allegedly set up a secret cryptocurrency mining operation

After skipping a planned court appearance to respond to accusations, a former facilities worker who is accused of setting up a covert bitcoin mining operation inside a Massachusetts school’s crawl space is slated to be arrested. The hearing was to answer to the allegations.

According to several sources in the media, Nadeam Nahas’ arraignment on the allegations of vandalizing a school and making fraudulent use of power was due to take place on February 23.

A form of warrant known as a default warrant is the kind of warrant that courts issue when a person fails to appear in court or comply with an order. This type of warrant gives law enforcement officials the authority to arrest the individual in question.

It is alleged that Nahas, who is said to have previously worked in the facilities department for the town of Cohasset, Massachusetts, United States, stole electricity worth almost $18,000 in order to power his cryptocurrency mining operation in 2021, between April 28 and December 14, specifically between the dates of April 28 and December 14.

According to the reports, the local authorities were notified about the operation for the first time in December 2021. This occurred after the director of facilities at Cohasset noticed computers, wiring, and ductwork that appeared to be out of place given that they were located in a crawl space close to the school’s boiler room.

There were a total of 11 computers discovered at the location, and after a three-month investigation, Nahas was determined to be a suspect in the case.

In March, Nahas handed in his resignation from his job with the municipality of Cohasset.

It is very unlikely that this is the first time someone has been accused of stealing energy for the purpose of mining cryptocurrencies.

Officials in Malaysia destroyed Bitcoin (BTC) mining rigs worth $1.2 million in July 2021 after seizing them from citizens who were stealing energy to mine Bitcoin. The rigs had been taken from citizens who were mining Bitcoin illegally.

A year earlier, in August of 2019, Bulgarian police made the arrest of two individuals for unlawfully siphoning off more than $1.5 million in energy to run two cryptocurrency mining farms.