Chinese Bitcoin Miner Gets 3.5 Years in Prison for Stealing Train Power

 In Bitcoin

A Chinese court has sentenced a local resident to three and a half years in prison and a fine of about $14,500 for stealing power from a train network to run his Bitcoin mining gig.

A Bitcoin miner in China has been sentenced to three and a half years in prison and a fine of 100,000 yuan (about $14,400) after he pled guilty to stealing electricity from a train network to feed his mining operation, as reported by local media outlet The Paper.

The Datong Railway Transport Court in China’s Shanxi province sentenced Xu Xinghua for stealing electricity from Kouquan Railway between November and December 2017. Xu used the power to run the 50-bit mining machine and three electric fans in his rented apartment. During this period, the miner stole nearly 104,000 yuan worth of electricity from the train network power lines and mined at least 3.2 Bitcoins, which were worth around $17,300 in April 2018.

However, the police estimated Xu could have earned more from his mining operation as the price of Bitcoin reached nearly $20,000 in December 2017. Investigators pegged his earnings at almost $6,500 at current prices.

Bitcoin mining rigs consume a lot of power. According to DigiConomist, the global power consumption of Bitcoin mining reached about 48.5 TW/h in 2017. The cost of electricity accounts for more than 70% of the value of Bitcoin earnings.

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The majority of China’s cryptocurrency mining pools is concentrated in Sichuan, which is rich in water resources. The region has cheap hydropower and a cold climate in addition to a low population density.

However, the benefits of mining have almost plateaued due to the decline in Bitcoin prices this year and the difficulties associated with mining. It has been calculated that when the unit price of Bitcoin drops to less than $6,300, mining becomes a losing proposition.

Last month, the People’s Bank of China issued a fresh warning to investors about the risks linked to virtual currencies and initial coin offerings (ICOs), which are banned in China.

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