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Illegal Bitcoin Mining Operation Tapping Cheap Power Busted in South Korea

Last Updated March 4, 2021 5:06 PM
Samburaj Das
Last Updated March 4, 2021 5:06 PM

South Korean police have arrested over a dozen individuals involved in an illegal bitcoin mining operation that used cheap electricity afforded to industrial complexes.

The metropolitan police agency of Gwangju, a city in country’s south, has revealed details of alleged illegal mining activities undertaken by 14 individuals from 14 companies in four separate industrial complexes in the city.  Six companies were located in Hanam Industrial complex, three in Nano Industrial Complex, three more in Pyeongdong Industrial Complex and one in Jeongok Industrial Complex.

As reported by Korean news agency Yonhap , companies operating within the industrial complexes gain benefits in subsidized rental and electricity costs. Power tariffs, in particular, are 10% cheaper for companies in industrial complexes, as opposed to companies located elsewhere.

The report claims that police have accused the fourteen companies of illegally mining cryptocurrencies like bitcoin since May 2017. Each company reportedly installed between 100-350 bitcoin miners within their premises of their industrial complexes, which the metropolitan police say is in violation of factory rules.

The incident isn’t the first time where cryptocurrency miners have seen accusations of illegally benefiting from cheaper power tariffs in South Korea, a country that is firmly among the world’s largest crypto trading markets.

A Seoul-based shopping mall took a notable measure of banning its own merchants from mining cryptocurrencies in their stores last year. Citing complaints about power consumption and room temperatures as well as concerns of a fire hazard, Yongsan Electronics Market moved to outlaw the activity among its vendors who used their own GPUs to mine cryptocurrency.

Featured image from Shutterstock.