Southeast Asia Grows Wary of Crypto Mining

TEMPO.CO, Jakarta - Malaysia's national utility firm Tenaga Nasional incurred losses of more than $1 billion (€860 million) from illegal power usage by cryptocurrency miners between 2020 and August this year, the country's Energy Ministry said earlier this month.  

Malaysian police have stepped up a crackdown, conducting several raids on suspected sites since January, as part of a multi-agency operation with energy regulators and anti-graft authorities to tackle electricity theft linked to crypto mining.

Tenaga Nasional said in a report to parliament this month that it had detected 13,827 establishments suspected of being illegal crypto mining sites.

"These activities not only threaten user safety, but also jeopardize the nation's economic stability, increase public safety risks ... and pose a serious threat to the national energy supply system," the public utility said in a statement.

China was once the world's largest site for crypto mining, an energy-intensive process that uses powerful computers to solve complex mathematical puzzles to validate cryptocurrency transactions and earn new digital coins as a reward.

But when China's government banned the practice in 2021, citing threats to the country's financial stability and energy conservation, several Southeast Asian countries moved quickly to welcome miners fleeing the crackdown, hoping to monetize cheap electricity and attract new investment.

Most notable was Laos, an energy-rich landlocked state, which in 2021 launched a public-private pilot program allowing a handful of firms to mine and trade cryptocurrencies using surplus hydropower.

Gathering storm

The mood around crypto mining has grown...