In a major blow to illicit cryptocurrency operations, Kazakh authorities have taken down a sprawling mining network accused of draining enough electricity to power an entire mid-sized city.
The operation, uncovered in East Kazakhstan Oblast, allegedly relied on corrupt insiders at utility companies who funneled vast amounts of energy away from homes, essential services, and strategic industries.
Instead of reaching hospitals, factories, and households, the stolen power was rerouted to hidden facilities minting digital coins.
Officials estimate the miners consumed over 50 megawatt-hours of electricity, valued at roughly 9 billion tenge ($16.5 million).
Investigators say the profits were funneled into luxury assets, including high-end apartments in the capital and multiple vehicles — all of which have been seized pending court action.
Kazakhstan’s position as a crypto mining hotspot emerged after China’s 2021 industry ban forced operators abroad. Initially welcomed for the potential economic boost, the influx soon pushed the national grid to breaking point.
In response, the government imposed strict rules: miners must purchase power through a state-run marketplace and are capped at one megawatt-hour per transaction.
The East Kazakhstan crackdown is just one example of a wider regional push against unlicensed mining. Russian regulators have launched a national registry for mining equipment and pledged tough enforcement against underground operators.
Elsewhere, countries like France are exploring unconventional solutions, such as channeling unused nuclear power into regulated Bitcoin mining ventures.
For Kazakhstan, the case is a stark reminder of the economic and infrastructural strain that unchecked crypto mining can place on public resources — and a signal that enforcement is moving into higher gear.
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/massive-bitcoin-mining-bust-in-kazakhstan-drains-city-sized-power-supply/