Illegal crypto mining threatens security and reliability of public power supply
PETALING JAYA: Electricity theft for crypto mining will lead to recurring interruptions in electricity supply as it causes system outages, disruptions to businesses and endangers people’s safety due to the threat of fires , said Tenaga Nasional Berhad (TNB).
“With increased co-operation from the Energy Board, police and local councils, TNB detected a total of 1,368 cases of electricity theft from January to April this year,” the company said. the sun.
He said these miners were carrying out their illegal activities to the detriment of the safety and reliability of the public power supply.
Although it is legal to mine crypto in Malaysia, TNB said it becomes illegal when miners steal electricity either by tampering with meter installations or bypassing the meter through illegal connections.
Last Thursday, a team from Hilir Perak District Police Headquarters seized 72 bitcoin mining machines worth RM140,000 from a shop suspected of being used to steal electricity at Jalan Intan 3, Bandar Baru Teluk Intan.
The illegal power connection consumed a huge load to mine Bitcoin and compromised the integrity and stability of the power supply in the region.
It was previously reported that from 2018 to 2021, 7,209 cases of electricity theft for Bitcoin mining were recorded, with losses estimated at RM2.3 billion, or 4,545 GWh (gigawatt hours). ‘electricity.
“Cryptominers run their systems non-stop, consuming a large amount of power. In one day, a Bitcoin machine is estimated to consume 32 KWh (kilowatt hours) of electricity, which is equivalent to two one-horsepower air conditioners running 24 hours a day. Others, such as cooling systems and the lighting, also operate continuously.
“Additionally, the wiring network in cryptocurrency mining premises puts buildings at risk due to the uninterrupted operation of powerful computers without proper supervision.
“This high-risk situation can trigger a variety of overload incidents, including supply disruptions, fires in the premises and surrounding areas, and flashovers or sudden fires at TNB facilities,” TNB said.
Aaron Tang, country manager of Luno Malaysia, which is a crypto platform, said the mining process involves a global network of computers equipped with specialized technology that compete to solve mathematical puzzles.
These computers are known as “miners”, but they are essentially computers that process transactions.
“The first bitcoin miner to solve the puzzle and add the transaction to the blockchain is rewarded with a new bitcoin. Once this happens, the process starts over again until the next puzzle is solved.
“To do this in a very secure way, these miners have to perform very complicated calculations that require a lot of computing power and, in turn, require a lot of energy and specialized processing equipment,” he said. .
He said the mining process is necessary to generate more crypto in circulation.
“You can think of crypto, like Bitcoin, as a global ledger system that records transactions between one person and another. Whenever Bitcoin transactions are processed, someone has to ensure that all transactions are recorded correctly and that the ledgers of all systems in the world are in sync,” he said.
Sinegy, a fintech company that develops platforms, tools and services for cryptocurrencies, said the crypto is mined using application-specific integrated circuit (Asic) mining machines. Asic miners can cost up to RM10,000 per rig and consume a lot of electricity during the process.
Its managing director, Kelvyn Chuah, said electricity tariffs for industrial areas are around RM 0.35 sen per KWh, while off-peak tariffs can drop by up to 30%. Done correctly, it can very easily be a profitable business without having to resort to stealing electricity.
“We think it is in everyone’s interest to legitimize these kinds of operations. Mining permits should be issued by city councils to reward entrepreneurs who are sufficiently capitalized to operate ethically.
“This will prevent electricity theft and fire hazards while strengthening Malaysia’s presence in the global crypto mining industry,” he said.