As underground mining activities are ramping up around the world, it’s a somewhat strange mining farm that has been discovered in Russia’s oldest prison. Running on government-paid electricity, it was run by one of the deputy directors. He is currently being heard by the authorities.
A prison warden made a cryptocurrency mining farm on his premises
Law enforcement agencies in Moscow discovered equipment for mining cryptocurrencies on the premises of a psychiatric hospital located directly in Butyrka prison, the oldest in Russia. This prison was built in 1971 near downtown Moscow, and has seen famous prisoners like Heinz Hitler, Adolf Hitler’s nephew.
But today, one of the deputy directors of this detention center seemed to want to make it profitable in another way as he simply made a completely illegal mining farm, according to the local Russian daily Kommersant.
The equipment was reportedly installed in November 2021, according to investigators, and it was used to mine cryptocurrencies until at least February 2022. It is highly likely to be Bitcoin (BTC) mining.
The deputy director of the prison is currently being heard by the local authorities, the Investigative Committee of the Russian Federation, for possible abuse of power. He is accused by the investigation “of actions that clearly go beyond his powers, thus significantly violating the legally protected interests of the company or the state.”
During the time the equipment was operating, nearly 8,400 kW of government-paid electricity was consumed, at a total cost of more than 62,000 rubles (nearly $1,000).
His accomplices have not yet been identified. According to the Russian criminal code, the penalty for this type of crime ranges from a simple fine to four years in prison.
Russia wages war against illegal mining
Cryptocurrency mining with Russian-subsidized and sometimes stolen electricity has become an attractive source of extra income for many citizens, which is why the country is hunting illegal miners.
Russian regions such as Krasnoyarsk Krai and Irkutsk Oblast, which have historically kept electricity rates low for the population and public institutions, have become hotspots for this unauthorized activity.
Illegal miners have been blamed for frequent power outages and blackouts, especially in residential areas where power grids are unable to handle excessive consumption.
To address and deter this phenomenon, a Russian authority recently proposed the introduction of higher electricity rates for home-based cryptocurrency miners.
There have been recent police operations against underground mining activities across Russia, with law enforcement seizing more than 1,500 pieces of mining equipment from two illegal cryptocurrency farms in Dagestan. One of them was mining cryptocurrencies at a water supply station in the country.
But in the face of limitations and bans, underground activities are more likely to proliferate, as evidenced by Bitcoin (BTC) mining statistics in China.