Bitcoin Mining Contributing to Massive Electricity Theft in Malaysia: Report

According to a report by a Malaysian media outlet, MalayMail, Bitcoin and cryptocurrency mining operations were mostly responsible for the massive electricity theft in the country between 2018 and 2023.

Despite the strict measures, cryptocurrency mining and public services are not illegal in the Asian country.

Bitcoin mining using stolen energy

Akmal Nasrullah Mohd Nasir, Malaysia’s deputy minister for energy and water transformation, said the country lost nearly RM3.4 billion ($723 million) between 2018 and 2023 due to unauthorized electricity supplies for cryptocurrency mining.

Akmal Nasser spoke at an event where more than 2,000 pieces of equipment confiscated in the October 2022 campaign were disposed of. According to the reportThe equipment, valued at about $467,000, lacked ST safety certifications. Among those present at the event were T-Zone Operations Manager Ismail Zeli Yusup and ST Chief Operating Officer Dr. V. Sanjayan.

The Deputy Prime Minister pointed out that electricity theft activities are not only bad for Tenaga Nasional Berhad (TNB), but also bad for the people and the country as a whole. He said:

“Electricity theft by cryptocurrency miners occurs because they believe that this activity goes undetected due to the lack of meters on their premises. However, energy supply companies have different ways of detecting unusual energy consumption in an area.”

He stated that the Public Prosecution ordered the disposal of these items “in accordance with the provisions of Articles 406A and 407 of the Code of Criminal Procedure” after completing the trial and complex procedures.

Akmal Nasser said that the ministry prioritizes efforts to combat electricity theft while promoting clean green energy production.

The Deputy Minister also posted on the X platform. note Ironically, electricity theft runs into the hundreds of millions, and sometimes billions, in a country that claims to be implementing an energy transition agenda to add new energy sources.

Akmal pointed out that during disposal of the goods, they will be disposed of in strict accordance with the requirements of the Environment Quality Act 1974 and the Environment Quality (Scheduled Wastes) Regulations 2005.

Cryptocurrencies and mining are not illegal.

Despite the crackdown that began in August 2019, cryptocurrencies and mining are not illegal in Malaysia. However, according to paper According to the University of Technology MARA Malaysia, “stealing electricity to mine cryptocurrency is an illegal act.”

The paper suggested that the Malaysian government should create and adopt an appropriate framework that miners should adhere to to reduce electricity theft.

Not only cryptocurrency miners, but also cryptocurrency service providers in general such as some exchanges, have been on the wrong side of the Malaysian authorities. For example, Huobi Global had to shut down its services in Malaysia because it failed to register as required.