Kazakhstan's authorities have dismantled a large-scale illegal cryptocurrency mining operation that siphoned off more than $16 million worth of electricity—enough to power a small city—from utility networks in eastern Kazakhstan.
What Happened?
The Financial Monitoring Agency (AFM) and National Security Committee (KNB) uncovered a scheme where utility employees illicitly sold power meant for public use—including homes, social services, and vital businesses—to crypto miners.
Over a two-year period, these operations consumed more than 50 MWh of power, equivalent to the energy usage of a city with 50,000 to 70,000 residents.
The estimated value of stolen power is over 9 billion tenge (~$16.5 million USD).
Assets obtained through the scheme—namely two apartments in the capital and four vehicles—have been seized pending forfeiture.
Context: Kazakhstan’s Broader Crypto Crackdown
This case is part of a wider crackdown over the years:
In February 2022, authorities shut down 13 illegal mining farms consuming a combined 202 MW of electricity across multiple regions.
That same period saw seizures of around 67,000 mining machines worth hundreds of millions in U.S. dollars and led to at least 25 criminal cases.
These actions were driven by severe grid strain—miners were drawing up to 1.2 GW, amounting to about 8% of the country’s total capacity.
Why It Matters
Energy Security: This theft underscores the critical risks posed by unregulated mining to Kazakhstan’s power grid and public welfare.
Regulatory Enforcement: The penalty extends beyond shutting down miners—it adds legal actions, asset seizure, and preventive oversight.
Policy Evolution: Such enforcement likely accelerates tighter regulations on crypto-mining operations, ensuring they operate within legal and infrastructural boundaries.
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