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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust
By Davies & Ostroff, 5/28/21, Wall St. Journal

British police got a shock when they raided a suspected
illegal cannabis farm this week: Instead of halogen lamps &
weed, they found about 100 computers mining bitcoin.

Officers from the West Midlands Police forced entry into
the warehouse in an area west of the city of Birmingham
known as the Black Country with a drug warrant, after intel
suggested it was being used to grow the illegal crop.

Unusual amounts of wiring & ventilation were visible on the
outside of the building & a drone had measured high levels
of heat rising from itclassic signs of a cannabis factory.
But the officers broke in to discover a huge bank of
computers in what they now suspect was a cryptocurrency mine.

They also found that the computers used stolen electricity
by tapping directly into the power supply outside of the
warehouses circuits. Police said the mine consumed
thousands of pounds worth of electricity.

Crypto mining, particularly for bitcoin, has become a
lucrative biz as its value has shot higher, peaking at
about $60,000/bitcoin in April. But mining the coins, where
computers race to solve complex math puzzles, is also hugely
energy-intensive & very costly.

My understanding is that mining for crypto is not itself
illegal, but clearly abstracting electricity from the mains
supply to power it is, Sgt. Jennifer Griffin said in a
statement on Thurs. She added that no arrests were made
at the premises, but that the police would be making
inquiries with the owner of the warehouse.

The British warehouse had all the hallmarks of a cannabis
cultivation setup, Sgt. Griffin said. Its certainly not
what we were expecting.

Cryptocurrency mining has boomed as the value of bitcoins
rocketed this year. When computers compete to harvest fresh
coins by solving math puzzlesa process known as miningthe
new coins produced have fetched high prices.

On top of this, when a computer successfully solves the
puzzle, it is able to process some bitcoin transactions on
the network & can charge a fee for those services. Daily
rev from mining globally reached a record high of $77.8 mil
on April 15, acc. to CoinDesk, a research website that
tracks cryptos. On that same day, bitcoins dollar value
peaked at $63,381.20.

The process to obtain bitcoin is highly energy-intensive.
As more people compete to harvest the crypto, the harder
the math puzzles get & the more energy is required to gain
it. Bitcoins high energy use has drawn criticism in recent
weeks from Elon Musk.

Chinese officials have also recently indicated that they
will be taking measures to curb bitcoin mining in China,
one of the largest markets for it. Some mining services
have already started banning mainland China internet
addresses from accessing their platforms in the wake
of those comments.

Iran this week banned crypto mining for 4 months after a
series of unplanned blackouts in cities. President Rouhani
told a cabinet meeting that crypto mining was draining
2 gigawatts of electricity from Irans power grid each
day, acc. to the BBC.

The fictional DeLorean time machine in Back to the Future
needed just 1.21 gigawatts to travel thru time. And a
single gigawatt is enough to power 110 million LED lights,
or is equivalent to the power of 1.3 million horses, acc.
to the U.S. Dept of Energy.

Global crypto mining consumes about 114 terawatt-hrs/year,
which is more than the annual electricity needs of the
Netherlands or the Philippines, acc. to a tool built by
researchers at Univ of Cambridge Judge Business Schools
Centre for Alternative Finance.

Indoor cannabis farms also use heavy amounts of electricity
to power lights, fans, water pumps and heating systems.
U.S. cannabis farms consumed about 1% of national electrical
power in 2012, acc. to a study by the Lawrence Berkeley
National Lab. Today, that would be equivalent to nearly
40 terawatt-hrs/year.

https://www.wsj.com/articles/bitcoin...st-11622219458
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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

David P wrote:
Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust
By Davies & Ostroff, 5/28/21, Wall St. Journal

British police got a shock when they raided a suspected
illegal cannabis farm this week: Instead of halogen lamps &
weed, they found about 100 computers mining bitcoin.

Officers from the West Midlands Police forced entry into
the warehouse in an area west of the city of Birmingham
known as the Black Country with a drug warrant, after intel
suggested it was being used to grow the illegal crop.

Unusual amounts of wiring & ventilation were visible on the
outside of the building & a drone had measured high levels
of heat rising from itclassic signs of a cannabis factory.
But the officers broke in to discover a huge bank of
computers in what they now suspect was a cryptocurrency mine.

They also found that the computers used stolen electricity
by tapping directly into the power supply outside of the
warehouses circuits. Police said the mine consumed
thousands of pounds worth of electricity.


Actually, they're using Bitmain boxes, at around £3000 each.
At least £180,000 worth of mining equipment is pictured here.

https://i.guim.co.uk/img/media/6d318...9fe7d10a6556e0

The power consumption of what is pictured, would be 60kW.

The Chinese facility (that they claim was recently shut
down, but who knows), that one has 25000 machines
and 25MW of power consumption. There was an IEEE Spectrum
article about that facility, back when it had fewer sheds.

https://nypost.com/wp-content/upload...6&h=820&crop=1

Paul
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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

This has always seemed to me to be a completely bonkers concept. After all,
its hardly going to save the planet and no matter how good the encryption
somebody will be able to break it by just throwing resources at the problem.

Brian

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"Paul" wrote in message
...
David P wrote:
Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust
By Davies & Ostroff, 5/28/21, Wall St. Journal British police got a shock
when they raided a suspected illegal cannabis farm this week: Instead of
halogen lamps & weed, they found about 100 computers mining bitcoin.

Officers from the West Midlands Police forced entry into the warehouse in
an area west of the city of Birmingham known as the Black Country with a
drug warrant, after intel suggested it was being used to grow the illegal
crop.

Unusual amounts of wiring & ventilation were visible on the outside of
the building & a drone had measured high levels of heat rising from
it-classic signs of a cannabis factory. But the officers broke in to
discover a huge bank of computers in what they now suspect was a
cryptocurrency mine.

They also found that the computers used stolen electricity by tapping
directly into the power supply outside of the warehouse's circuits.
Police said the mine consumed thousands of pounds worth of electricity.


Actually, they're using Bitmain boxes, at around 3000 each.
At least 180,000 worth of mining equipment is pictured here.

https://i.guim.co.uk/img/media/6d318...9fe7d10a6556e0

The power consumption of what is pictured, would be 60kW.

The Chinese facility (that they claim was recently shut
down, but who knows), that one has 25000 machines
and 25MW of power consumption. There was an IEEE Spectrum
article about that facility, back when it had fewer sheds.

https://nypost.com/wp-content/upload...6&h=820&crop=1

Paul



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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

On 05/06/2021 08:51, Brian Gaff (Sofa) wrote:

This has always seemed to me to be a completely bonkers concept.


arguably the concept (of blockchain) is ok, although the implemenation
in its bitcoin variety seems fundamentally flawed due to its energy
requirements and the inability to scale in volume of transactions.

After all,
its hardly going to save the planet and no matter how good the encryption
somebody will be able to break it by just throwing resources at the problem.


Well that is kind of the point of its distributed architecture. It's
difficult to subvert when you have a massively parallel network of
miners verifying every transaction.



--
Cheers,

John.

/================================================== ===============\
| Internode Ltd - http://www.internode.co.uk |
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| John Rumm - john(at)internode(dot)co(dot)uk |
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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

Paul wrote:
Actually, they're using Bitmain boxes, at around £3000 each.
At least £180,000 worth of mining equipment is pictured here.


At new price. Bitcoin miners have extremely steep depreciation, because the
newest ones run faster and hence generate more 'return' for the same
electricity input. Since the amount of compute to mine a Bitcoin by design
increases regularly, it doesn't take long before the cost of electricity
overtakes the yield, at which point they only really have scrap value.

Of course if the electricity is 'free' (because you're stealing it) then you
can afford to run that scrap kit for longer.

I'm surprised they didn't use the waste heat to heat a cannabis growhouse
next door - think of the synergies!

Theo


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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust



"Paul" wrote in message
...
David P wrote:
Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust
By Davies & Ostroff, 5/28/21, Wall St. Journal British police got a shock
when they raided a suspected illegal cannabis farm this week: Instead of
halogen lamps & weed, they found about 100 computers mining bitcoin.

Officers from the West Midlands Police forced entry into the warehouse in
an area west of the city of Birmingham known as the Black Country with a
drug warrant, after intel suggested it was being used to grow the illegal
crop.

Unusual amounts of wiring & ventilation were visible on the outside of
the building & a drone had measured high levels of heat rising from
itclassic signs of a cannabis factory. But the officers broke in to
discover a huge bank of computers in what they now suspect was a
cryptocurrency mine.

They also found that the computers used stolen electricity by tapping
directly into the power supply outside of the warehouses circuits.
Police said the mine consumed thousands of pounds worth of electricity.


Actually, they're using Bitmain boxes, at around £3000 each.
At least £180,000 worth of mining equipment is pictured here.



I don't get how this crypto mining lark is allowed to continue by regulators

where's the underlying assets that props up the value of this new intangible
thing you have created?



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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

Jethro_uk wrote:
I notice that Norton have come up with a business model where you pay for
the product by effectively processing a blockchain.

https://forums.theregister.com/forum...norton_crypto/

I can see that taking off ...


The timing and the choice of Eth, is pretty weird.

https://www.wired.co.uk/article/bloc...ncy-energy-use

Paul

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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

Theo wrote:
Paul wrote:
Actually, they're using Bitmain boxes, at around £3000 each.
At least £180,000 worth of mining equipment is pictured here.


At new price. Bitcoin miners have extremely steep depreciation, because the
newest ones run faster and hence generate more 'return' for the same
electricity input. Since the amount of compute to mine a Bitcoin by design
increases regularly, it doesn't take long before the cost of electricity
overtakes the yield, at which point they only really have scrap value.

Of course if the electricity is 'free' (because you're stealing it) then you
can afford to run that scrap kit for longer.

I'm surprised they didn't use the waste heat to heat a cannabis growhouse
next door - think of the synergies!

Theo


https://www.asicminervalue.com/miner...tminer-s9-14th

Income $3.14 === "difficulty" affects your earning rate,
as well as current market value.
Electricity -$3.95 32.9kWh worth, salt to taste.
Profit -$0.81

The graph on the page, shows it was making money, up
until recently.

I can see how stealing lekky, would be a recently-attractive
opportunity. But you still risk having all your Antminers
confiscated on a pretext.

Paul
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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

On Sat, 5 Jun 2021 16:09:36 +0100, "tim..."
wrote:



"Paul" wrote in message
...

I don't get how this crypto mining lark is allowed to continue by regulators

where's the underlying assets that props up the value of this new intangible
thing you have created?


I think that ship sailed with the introduction of fractional reserve
banking.
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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

Caecilius wrote:
On Sat, 5 Jun 2021 16:09:36 +0100, "tim..."
wrote:


"Paul" wrote in message
...

I don't get how this crypto mining lark is allowed to continue by regulators

where's the underlying assets that props up the value of this new intangible
thing you have created?


I think that ship sailed with the introduction of fractional reserve
banking.


It's backed by Dogecoins.

https://cdn.vox-cdn.com/thumbor/I1yj...ecoin_logo.png

And if the asset value decreases, you peel off the
gold coloured foil, and there is chocolate underneath.

Paul


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Default Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust

On 05/06/2021 16:09, tim... wrote:


"Paul" wrote in message
...
David P wrote:
Bitcoin Mining Operation Is Uncovered During U.K. Drug Bust
By Davies & Ostroff, 5/28/21, Wall St. Journal British police got a
shock when they raided a suspected illegal cannabis farm this week:
Instead of halogen lamps & weed, they found about 100 computers
mining bitcoin.

Officers from the West Midlands Police forced entry into the
warehouse in an area west of the city of Birmingham known as the
Black Country with a drug warrant, after intel suggested it was being
used to grow the illegal crop.

Unusual amounts of wiring & ventilation were visible on the outside
of the building & a drone had measured high levels of heat rising
from itclassic signs of a cannabis factory. But the officers broke
in to discover a huge bank of computers in what they now suspect was
a cryptocurrency mine.

They also found that the computers used stolen electricity by tapping
directly into the power supply outside of the warehouses circuits.
Police said the mine consumed thousands of pounds worth of electricity.


Actually, they're using Bitmain boxes, at around £3000 each.
At least £180,000 worth of mining equipment is pictured here.



I don't get how this crypto mining lark is allowed to continue by
regulators

where's the underlying assets that props up the value of this new
intangible thing you have created?


You can pretend that Monopoly money is real if you like. Regulators only
regulate "official" money.

--
Max Demian
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