According to a local report, Miri authorities have successfully shut down an illegal cryptocurrency mining operation on Borneo’s island after a tip-off from the public.
The authorities acted promptly upon receiving the tip-off. They conducted a raid and successfully confiscated all equipment related to the illegal mining operation, including 34 mining servers that were illicitly siphoning electricity through cable tapping.
Despite Borneo boasting some of the lowest energy prices in Malaysia, the region still faces an ongoing issue of energy theft, as recently highlighted in a utility announcement.
Sarawak Energy, the energy provider in the area, reportedly claimed that the criminal enterprise caused a substantial loss of approximately 6,000 Malaysian ringgits ($1300) worth of stolen electricity per month.
In 2023, the Bitcoin mining industry reached record highs in key indicators like the network hash rate and network difficulty. While a flourishing number of miners usually signifies the Bitcoin network’s robustness, it has posed challenges for smaller operators without the economies of scale enjoyed by larger corporations.
One of the challenges a prolonged bear market poses for smaller Bitcoin miners is energy generation to power their mining servers. The lure of higher profit potential with lower electricity rates has likely contributed to the inclination of illegal mining operators to steal electricity from the grid. Eliminating energy expenses in mining operations allows these illicit miners to accumulate proceeds and cover equipment costs.
This latest incident is the fourth major operation in the state of Senadin, where Miri is situated, where authorities have raided power theft cases in 2023. So far, over 137 Bitcoin mining servers have been seized during these operations.
On the other hand, crypto mining companies are securing funding from various sources to support their mining projects. For instance, Riot Platforms invested $162.9 million to acquire 33,280 state-of-the-art equipment from a leading producer of mining machinery, MicroBT.
Coinbase also extended a $50 million credit line to Canadian cryptocurrency firm Hut 8 Mining to facilitate its operations. Additionally, Volcano Energy, a public-private partnership in El Salvador, has secured an initial funding of $250 million for its ambitious Bitcoin mining venture.
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