Malaysian authorities have launched a nationwide crackdown on illegal Bitcoin mining, citing USD$1.1 billion in power theft over five years and a surge in new cases this year.
Drones, handheld sensors, and on-the-ground inspections are being deployed to detect hidden rigs in abandoned buildings and shuttered malls looking for mining operations.
Police patrol alleys, storage yards, and deserted buildings, using sensors that track unusual electricity use. Residents sometimes report strange bird calls, only for investigators to uncover machines masked by recordings of nature sounds. In addition, each operation pits authorities against miners who constantly shift locations to evade detection.
Officials say the operators are increasingly sophisticated. Furthermore, miners move rigs from empty storefronts to abandoned houses, install heat shields to blunt thermal scans, and secure entrances with cameras, steel doors, and broken glass. Authorities describe each raid as a chase against operators who adapt quickly to enforcement measures.
Malaysia recorded about 14,000 illegal sites over five years. Tenaga Nasional estimates that power theft linked to mining caused roughly USD$1.1 billion in losses during that period. Activity surged again this year, with authorities logging approximately 3,000 cases tied to power theft by early October, amid Bitcoin’s volatile price swings.
The government formed a new cross-agency committee on Nov. 19 to coordinate enforcement. The panel also includes the Ministry of Finance, Bank Negara Malaysia, and TNB. Officials said the problem requires continuous oversight across multiple agencies.
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Malaysia has thought about banning mining entirely
Deputy Minister of Energy Transition and Water Transformation Akmal Nasrullah Mohd Nasir chairs the panel. He said mining operations now pose risks beyond theft, including potential damage to the power grid. He also noted that Bitcoin’s volatility makes even legal operations unstable. “I do not see any legal mining operation that is truly sustainable,” he told committee members.
The committee debated whether to ban mining outright. Some members said operators rarely maintain transparent records, while others warned that banning the industry could push it further underground. Akmal pointed to raid patterns that suggest organized networks. Miners’ rapid relocation and coordinated tactics, he said, indicate structured criminal involvement.
Bitcoin mining depends on massive racks of machines performing calculations non-stop. Miners compete to validate transactions and earn coins as rewards. The global industry consumes more electricity than South Africa or Thailand, with most activity now concentrated in the United States. Malaysia’s share remains unclear, as recent international surveys did not include updated data.
Local operators often repurpose unconventional spaces. ElementX Mall, overlooking the Strait of Malacca, remained mostly empty after the pandemic. In early 2022, miners installed rigs in the unfinished complex, drawing attention after a viral TikTok video. The machines were removed by early 2025.
In Sarawak, a company called Bityou set up a farm in a former logging yard. Observers also noted that it relied on heavy electrical infrastructure typical of commercial operations. Authorities continue to review such rural sites.
Bitcoin mining is legal when companies obtain power lawfully and pay taxes. Industry participants say the rules allow legitimate business. Authorities, however, argue miners exploit technical advantages to hide energy use.
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