Kazakhstan Cracks Down on Illegal Crypto Mining Operation Draining City Grid

Authorities in Kazakhstan have dismantled a large-scale illegal cryptocurrency mining operation in East Kazakhstan Oblast, which was siphoning off enough electricity to power a mid-sized city. The illicit network allegedly relied on corrupt utility insiders to divert energy from essential services like homes and hospitals to hidden mining facilities.

Prosecutors estimate the operation consumed over 50 megawatt-hours of electricity, valued at approximately $16.5 million. Luxury assets, including high-end apartments and vehicles, were seized as part of the investigation, revealing a sophisticated money laundering scheme tied to the mining profits.

Kazakhstan emerged as a global mining hub after China's 2021 ban, but the strain on its power grid has led to stricter regulations. Miners are now required to purchase electricity through a state-run marketplace, with caps on transaction volumes.