Bitcoin mining, a complex activity that requires adding data to the blockchain, has been the subject of complaints. While it is arguably a lucrative business for some, it impacts the local power grid.
Some estimates suggest that you need up to 155,000 kilowatt hours (kilowatt-hours) of electricity just to mine a single coin, and each transaction requires about 851 kilowatt-hours, equivalent to one month’s electricity supply for an average household in the United States.
The threat posed by Bitcoin mining is global, with many national and local economies feeling the damage. For example, she cited Tenaga Nasional Berhad, Malaysia’s national electricity utility Losses of more than 440 million ringgit (about $101 million) due to mining-related electricity theft. This figure comes on top of the reported seizure of electrical items related to Bitcoin mining worth $500,000.
Local reports say the theft affected TNB for years
A report from The Star says Tenaga Nasional Berhad was bleeding out of him Bitcoin mining-related thefts Since 2020. According to Comm Datuk Seri Mohd Shuhaily Mohd Zain, the company has suffered increasing losses year-on-year.
The director added that in 2020 alone, the company lost RM5.9 million, rising to RM140.4 million the following year. Then in 2022, losses reached RM124.9 million. In 2023, it rises to RM67.1. This year, losses reached RM103 million and still rising.
As of today, the market cap of cryptocurrencies stood at $2.4 trillion. Chart: TradingView.com
Bitcoin mining continues to impact local supply
TNB and local authorities claim that the losses date back to 2018 and are linked to illegal mining operations. TNB said in another separate paper that its losses between 2018 and 2023 amounted to more than $755 million.
Although Crypto mining It represents only a small portion of Malaysia’s total consumption, and has a significant financial impact. In addition to the National Bank’s losses, more than $500,000 worth of electrical equipment linked to illegal mining operations was confiscated.
The government’s seizure of these electrical items is part of Malaysia’s anti-tax evasion drive that includes various parties involved in cryptocurrencies. The Malaysian Criminal Investigation Unit plans to investigate the thefts and factors contributing to the growing loss trend.
How does Bitcoin mining affect electricity companies?
Bitcoin mining is a complex activity that involves adding new data to the blockchain but requires extensive energy. In exchange for Bitcoin, an individual or company must solve a complex mathematical problem in order to “mine” or obtain Bitcoin.
However, experts say that this process requires a great deal of power and computational power. In many countries such as Malaysia, the need for large electricity supplies often tempts people to evade payment and commit crimes.
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