Seven Arrested in Malaysia for Bitcoin Mining Electricity Theft; 52 Rigs Seized

Malaysian officials have arrested seven people for suspected bitcoin mining operations that involved stealing electricity.

The local media, Bernama, reported that the detainees include three Malaysians and four foreigners, who were held separately last week.

Electricity Theft in Malaysia

In an official statement, the Sepang District Police Chief, ACP Wan Kamarul Azran Wan Yusof, mentioned that the detained individuals had no prior criminal records. The local police also confiscated 52 mining rigs and other electronic devices, worth RM 250,000 worth approximately $57,000.

The intense competition in crypto mining often boils down to obtaining cheap electricity. In Malaysia, certain miners are aggressively looking to find free energy even as electricity theft, as defined by Section 33(5) of the Electricity Ordinance, carries penalties of fines up to RM100,000 and/or a maximum prison term of five years.

Last month, Sarawak Energy, a state-owned electric provider in Malaysia, accused cryptocurrency miners of repeatedly stealing electricity for their mining rigs. Sarawak teamed up with local law enforcement for a joint operation and found that two mining operations were suspected of stealing RM 30,000, valued at $6,500, worth of electricity each month.

They also suggested that both operations were connected and controlled by the same entity. As part of the investigation, 120 machines and various electronic devices were seized.

While crypto and mining activities remain legal in Malaysia, a recent report highlighted that these operations were the primary cause of significant electricity theft in the country between 2018 and 2023, leading to losses of approximately RM3.4 billion, worth nearly $723 million, due to unauthorized electricity use.

A Similar Crisis in Thailand

Across the border in Thailand, authorities are facing a similar challenge with electricity theft linked to crypto mining. In prior investigations, the MEA found several commercial buildings that appeared abandoned but exhibited signs of bitcoin mining, such as constant loud fans, sealed entrances, and round-the-clock air-conditioning.

To encourage public reporting, the authorities have promised to keep all information confidential and offered various ways for citizens to report suspected illegal electricity use for Bitcoin mining.