News & Reports

‹ Back

Chinese Police Confiscate Cryptocurrency Mining Rigs Over Electricity Theft

 

Recent news reports reveal that over 200 computers used for the mining of ethereum and bitcoin in a particular cryptocurrency mining operation have been confiscated by the Chinese police on grounds of involvement in electricity theft. Xinhua, a China`s state-owned media outlet reported that the police in the Anhi Province of eastern China seized the equipment, following an alert of extremely high electricity consumption by the local power grid`s operator.

 

A man who goes by the surname Ma is reported to be the prime suspect in this case of power theft. The Xinhua news report also stated that Ma allegedly pilfered 150,000 Kw hours of electricity over the course of slightly over a month. An investigation conducted by the Hanshan police revealed that the electricity meter joined to the crypto mining operation was deliberately short-circuited so as to evade the power bills that had accrued from the operations.

 

Ma is quoted as asserting that it was only after he purchased the mining equipment in April this year that he realized that it will cost over 6,000 yuan ($923) in power cost to run the mining operation successfully. The police caught up with him very early in his operations – less than two months into bitcoin and ethereum mining operation. As a consequence, he was yet to make some profit from his operations when his dealings were discovered by the police.

 

A similar incidence was reported in April involving a bitcoin mining operation in which the mains of a local junction box had been allegedly tampered with. The police in the city of Tianjin in northeastern China were alerted by the local power company of sudden spikes in electricity consumption. Six persons were suspected to be involved in this operation and as many as 600 bitcoin mining computers were subsequently confiscated by the police, reports indicate.

 

Cryptocurrency mining in China

 

Cryptocurrency mining is generally considered to be lucrative. It involves an energy-intensive process in which blocks of validated transactions are created and added to the blockchain. Miners are rewarded with newly mined coins as a consequence. A miner is considered to have made profits in this operation when it becomes clear that the computing power cost has been exceeded by the value of the mined coins.

 

China, once reputed to be the world`s largest cryptocurrency market is still home to many legitimate bitcoin mining companies mainly due to relatively cheaper labor and electricity cost. It appears however that the Chinese government`s support for the industry is waning following several reported cases of power theft involving cryptocurrency mining operations.

 

As part of the Chinese government`s relentless and far reaching crackdown, it has discouraged local governments from offering support to domestic cryptocurrency mining operations. Reports suggest that the strict measures being employed by Beijing has led to many cryptocurrency miners exiting the Chinese market. The likes of the cryptocurrency mining giant Bitmain are looking to commence operations in countries such as the United States and Switzerland.

 

Thanks for dropping by. Kindly share this post with your contacts. And visit this site more often for credible, juicy and up-to-date cryptocurrency news and a multiplicity of high value content.

Image from