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Stolen Icelandic Bitcoin (BTC) Mining Gear Might Be Found In China

A series of large-scale robberies placed in December 2017 through January 2018 in Iceland made the robbers richer by roughly $2 million in bitcoin-mining equipment.

Iceland is a unique place for tech-labs and hubs as its land temperature is low enough for the energy-consuming servers to run efficiently without heat problems, and the electricity cost is also low compared to other European countries. The combination of these two factors alone is crucial for tech investors.

Until last year, China was the capital of cryptocurrency mining plants. That lasted until recently when China placed an embargo on ICOs and blockchain-based virtual currencies.

The eastern industrial titan has already been regulating energy consumption to spot cryptocurrency miners, and rumors want China to ban mining as a whole from its mainland.

About 600 servers were stolen from Iceland, during four heists from data centers in Reykjanesbaer near Reykjavik airport and Borgarnes on Iceland’s west coast. Along with those an additional amount of about 600 graphics processors, 100 CPUs, 100 power supplies, 100 sets of RAM memories and 100 motherboards had been stolen in the spate of thefts.

Icelandic authorities were able to identify and arrest 2 suspects in February but were unable to locate the stolen hardware at that time. However after making the case public not long ago, in order to upscale the investigation, another country’s authorities seem to have found leads related to the incident.

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The stolen mining equipment is estimated to be worth around $1,7 million, while it could generate multiplied profits if used properly to “mine” cryptocurrencies like Bitcoin.

Speculations want the stolen goods to be located in China, as local authorities have recently confiscated 600 servers from a “suspicious” mining facility. Taijin authorities located the mining plant, after being notified by the local electrical-grid operator, about an unregistered unknown plant that uses an extraordinary amount of electricity.

In a nutshell, mining is the process behind the scenes when you exchange Bitcoin or other minable cryptocurrencies. A miner, usually a user with mining equipment, “lends” his computing power to the blockchain-powered network to confirm, and/or promote transactions.

The mining process can be messy and requires a lot of energy consumption, while at the same time it generates extreme heat and noise. That is why everytime a miner contributes to the smooth operation of the system, he gets rewarded with a portion of the respective token he is currently mining, in exchange for his computing power attributed to the blockchain platform itself.

Major mining plants in Russia, China, and Iceland have created mining plants that support thousands of graphics processors, CPUs, and other mining specific gear in one single geolocation, that is usually also guarded like a military base for obvious reasons.

Rumors want one of the world’s largest mining plants generating a profit of ~700 BTC each month, currently equivalent to $6,500,000 million dollars, of which around 1/3 is spent on power supply due to the extremely high electricity consumption mining requires, as prementioned.

While mining is not at its best at the moment, as even minable projects like Ethereum (ETH) are proposing to change from PoW to PoS, eliminating miners for good, you can still generate enormous profits of it if used under well-calculated circumstances.

Although the amount of missing equipment seems to be on point, the Chinese authorities have not yet officially concluded that these are the same stolen physical products, missing from Iceland. Currently, one suspect is held in detention, while five other members of the illegal mining plant are being investigated.

If there is a substantial link between the two incidents, it would seem like the robbers had not planed enough long ahead, as strict Chinese regulations outplayed them. In case of the opposite scenario, or simply if there is no connection between the two incidents and it is just a coincidence, the robbers will have to deal with the Chinese regulators, while the Icelandic authorities will have to extend their investigation for the responsible person or group behind the initial heist.

We’re following the incident and will posit an update as soon as the Chinese authorities release an official announcement regarding the matter.

Reporting for Tech News Leader, Ross Peili

 

 

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