Monday, July 15, 2019

Russian Church Takes Advantage Of Cheap Power To Mine Crypto, Pays The Price Later

Cryptocurrencies are taking the world and not even churches are outside of this predicament. But what does a little Protestant church located in the region of Siberia in Russia has to do with the world of cryptocurrencies? It seems like the church was taking advantage of the preferential rates that the region and state offer to Non-Government Organizations to mine cryptocurrencies in a server room inside the church.

The church of Irkutsk was taken to court because they were using too much power, so much that the employees of the power company said that they were endangering the supply for the whole region. Mining is a power intensive task that is needed to maintain the network of a cryptocurrency functioning in exchange for a reward. Probably members of the church were using this cheap power to get a major earning percentage.

But the court ruled in favor of the power company and now the church will have to pay the remaining $16,600 that the power company collected as the form of payment for the power used. and now it will have to submit to new, higher power tariffs.

This case sets a dangerous precedent because it endangers the whole hobby mining sector who mines n their homes and backyards to get a profit. Now, when an abnormal surge of energy consumption is detected, maybe they will have to submit to the rule of a court and pay a fine. Russia is one of the countries with the cheapest energy rates in the whole world, a thing that makes it ideal to run cryptocurrency mining farms, in addition to the cold weather that makes easier for miners to refrigerate the rooms where these machines are located.

Related Article:  Plattsburgh Passes New Regulations For Cryptocurrency Mining
Related Article:  Plattsburgh Passes New Regulations For Cryptocurrency Mining

It is unclear if this case could be considered as a power theft, but at least it is an irregular power use. Cases of power theft are becoming more and more common in countries like Russia and China, where there are big cryptocurrency farms. Also, the number one factor that fuels this power theft is the loss of profitability due to the poor performance of cryptocurrencies like bitcoin and Ethereum in the market.

Many of these farms were built in the cryptocurrency bonanza period of December last year when bitcoin prices reached up to $17,000, and people behind them thought these high prices would hold. But prices have fallen more than 70% ever since, and people have been left with unprofitable businesses that need to keep running.

 

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