Malaysia’s national electricity company, Tenaga Nasional Berhad (TNB), reported over $101mn in losses due to electricity theft linked to Bitcoin mining. The activities began in 2020, and the losses have increased each year. In addition to TNB’s losses, electrical equipment related to illicit mining operations worth over $500,000 was confiscated. Bitcoin mining involves solutions to complex mathematical problems using extensive computing power, which requires considerable electricity resources. As a response, Malaysia is targeting tax evasion linked to cryptocurrencies and will investigate the thefts.
The Defi Comment:
- Bitcoin mining involves solving complex mathematical problems to add new data to the blockchain, a process that requires significant amounts of electricity.
- It is estimated that mining one bitcoin can use up to 155,000 kilowatt hours (kWh) of electricity. In context, each Bitcoin transaction requires around 851 kWh, equivalent to an average US household’s monthly electricity supply.
- Bitcoin mining has had a significant financial impact worldwide, and has led to losses in local electricity grids. An extreme instance is in Malaysia, where the national electricity provider, Tenaga Nasional Berhad (TNB), reportedly lost more than 440 million Ringgit (about $101 million) due to electricity theft linked to Bitcoin mining.
- The illegal pursuit of Bitcoin mining has increased over the years, leading to substantial year-on-year losses for companies like TNB. In response, Malaysian authorities have confiscated over $500,000 worth of electrical equipment related to illicit mining.
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