Why do Some People Steal Electricity to Mine Bitcoin (The Initial Theft of Electricity to Mine Bitcoin)

08/13/2023 09:16 • Metaverse Matters • 113 views

Why do some people steal electricity to mine Bitcoin? What is the deal with the act of stealing electricity for Bitcoin mining, and what does it actually mean?

In a report on October 12, 2017, it was shown that the global Bitcoin hash rate had grown nearly 5 times, reaching a historical high of 14T. However, there has been a change this time. According to data from the University of Cambridge, the number of new ASIC hardware in 2019 reached 6, which is two to three times higher than the previous year. But from the data, these ASIC devices have already accounted for more than half of the entire cryptocurrency market share. This has created a major case of electricity theft – the “stolen electricity” mining incident. “Stolen electricity” mining is a typical scam: if you run a server on your computer and exhaust the power, you will be attacked by hackers who will steal your assets, resulting in losses. It is essentially using stolen electricity to consume resources. For example, if you open a software wallet or browser plugin on your computer and it sends you a bunch of virtual coins, if you can find a website and haven’t downloaded the program properly, then your funds will be stolen because the website has its own account password and private key, so it can directly access your account. This is a process of selling fake goods on the dark web.

This illegal behavior is mainly reflected in several aspects:

1. Due to the rapid development and low cost of blockchain technology, network security has become an undeniable target.2. Massive leakage of personal information can mislead people about various decentralized applications, thereby affecting the security of their property.

3. It causes many companies to be unwilling to pay high prices for profits, and even companies themselves are not sure if they really want to make money, which gives rise to this statement.

4. Some company founders believe that their business model is simple and just provides an excuse for profit. But they don’t actually do that and also require customers to pay taxes (to avoid consumer dissatisfaction). It seems like a dangerous signal for newcomers to start-ups who want to take advantage of government subsidies.

Many people think that Bitcoin is an empty project, which is actually because the price of Bitcoin is too expensive. Either it is to attract investors to buy or to allow investors to earn more money, so they start looking for new outlets. This will increase the participation and heat of the market, and the final result is that the exchanges go bankrupt, coupled with more and more people choosing to enter the exchanges for transactions, resulting in a large loss of Bitcoin.

Of course, we can also see why some institutions like this approach.

Firstly, theft of electricity in Bitcoin has been happening in the past few years. With the development of the industry, the value of Bitcoin is becoming increasingly prominent, especially when we talk about miners.

The Initial Theft of Electricity to Mine Bitcoin

At the birth of Bitcoin, there was a saying called “stealing electricity to mine coins.” This phrase originated from the lax power supply requirements of mining farms by JPMorgan Chase. The phrase “using electricity to steal electricity to mine Bitcoin” first appeared in an article in The New York Times on January 3, 2008: “When someone says we use a lot of energy, you find that these devices are full of stolen electricity.”

Later, some netizens revealed that they used Tesla’s garage to mine virtual currencies such as BTC and BCH, stating that “if I tell you it has no value, then your computer won’t be able to run.” Subsequently, Wu Jihan, the co-founder of Bitmain, expressed agreement but rejected this viewpoint. He believes that although it is now easier than ever to mine cryptocurrencies, in the long run, electricity theft may only result in fewer economic benefits. (BlockRelay)

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Why do Some People Steal Electricity to Mine Bitcoin (The Initial Theft of Electricity to Mine Bitcoin)

The Initial Theft of Electricity to Mine Bitcoin

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