Illegal crypto mining operations in Malaysia have stolen an estimated $723 million worth of electricity between 2018 and 2023, according to the country’s Deputy Minister of Energy Transition and Water Transformation, Akmal Nasrullah Mohd Nasir. The figure was revealed during an event where authorities disposed of over 2,000 seized items, including Bitcoin mining machines and electrical equipment.
Scale of the Theft and Its Impact
The illegal mining operations have significantly impacted Malaysia’s state-controlled power operator, Tenaga Nasional Berhad, and local communities. These operators typically bypass electricity meters or divert power directly from power lines to avoid detection and registration with authorities.
“The theft of electricity by those who mine cryptocurrency occurs because they believe this activity cannot be detected due to the absence of meters on their premises,” Nasir explained. However, energy supply companies employ various methods to detect unusual energy consumption, enabling officials to identify and seize illegal mining operations.
Recent Seizures and Legal Actions
In October 2022, Malaysian officials seized over 2,000 items worth approximately $467,000 during a crackdown on illegal mining operations. The seized equipment included Bitcoin mining machines and other electrical devices. Some of these machines were disposed of by being crushed with a steamroller.
Nasir emphasized that while mining cryptocurrency is not illegal in Malaysia, stealing electricity to power mining operations is a criminal offense. This distinction was clarified by Malaysia’s Universiti Teknologi MARA in December 2022. Malaysian authorities have been conducting seizures of cryptocurrency miners since at least August 2019, following the country’s criminal procedure laws.
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Government Initiatives and Renewable Energy Focus
In addition to cracking down on illegal miners, the Malaysian government is prioritizing efforts to increase the country’s renewable energy sources. Nasir highlighted that addressing illegal mining activities is part of broader efforts to ensure a sustainable and secure energy supply.
Regulatory Actions Against Unregistered Exchanges
Malaysia is also stringent about cryptocurrency exchange regulations. In May 2022, the Securities Commission Malaysia ordered Huobi Global to cease operations for failing to register its trading services. Currently, only six cryptocurrency trading platforms are officially registered in Malaysia: HATA Digital, Luno, SINEGY, MX Global, Tokenize Technology, and Torum International.
