Posted on

Genesis Mining Compels Certain Customers to Upgrade BTC Mining Contracts

Iceland-based hashpower hosting service Genesis Mining is compelling some of its customers to upgrade their Bitcoin (BTC) mining contracts following this year’s significant cryptocurrency price decline, according to an August 17 statement.

In 60 days, the company will terminate services for open-ended contracts that mine less than the daily maintenance fee. Genesis claims that the downward trend of BTC around January and heavy decline in crypto mining in April and May resulted in a reduction of mining outputs.

If customers wish to continue using Genesis’ services, they have to upgrade their existing BTC mining contracts to premium five-year contracts. Genesis notes in the announcement:

“…as a hashpower hosting service, we can only influence one out of the three main factors that determine mining rewards, and that is the infrastructure… The market price of Bitcoin and the mining difficulty are factors we cannot control.”

Genesis Mining was started in 2014, with locations in Bosnia and China. The company subsequently moved to Iceland and Canada due to the cold climate and cheap electricity rates.

In March, Genesis was issued a cease and desist order and asked to leave the state of South Carolina due to selling “unlicensed securities.” South Carolina demanded Genesis not only halt operations within its borders, but pay an “appropriate civil penalty for the wrongdoing.”

Since Bitcoin slid from it’s famed $20,000 peak last December, miners have struggled to stay above water as the combination of low prices and regulatory pressure continues to put a squeeze on the industry.

In June, Canadian provincial utility Hydro-Quebec proposed new rules, under which blockchain companies will be required to bid for electricity and quantify the jobs and investment they expect to generate per megawatt. The new regime seeks to allocate up to 500 megawatts, in addition to 120 megawatts of already existing initiatives.

Posted on

Bitcoin Miner Heist – From Iceland To China

Given the surge in popularity of cryptocurrencies over the past few years, mining has become a seriously lucrative endeavor. All over the world miners have set up operations, big and small, as they look to capitalize on dwindling Bitcoin rewards from processing transactions and validating the blockchain.

With plenty at stake, the costs of setting up even a small operation can be hefty, from the actual hardware to cooling systems and electricity consumption. However, those with enough capital to buy the best hardware, namely ASIC miners, put themselves in a commanding position.

But that also makes them a target for criminals. Whether these crooks want to hack your system and steal your valuable cryptocurrency or make off with your physical hardware, the potential dangers are real.

The latter scenario grabbed headlines this month, as over 600 computers used to mine Bitcoin have been seized in China, valued at over $2 mln alone.

From Iceland to China?

The seized equipment is being linked to a series of thefts in Iceland late last year. Three separate incidents spanning from December to January led to a total of 600 computers being stolen by a number of culprits.

The Associated Press reported that eleven people were initially arrested, while two men were kept in custody for the burglaries — one of which took place in January at a data center that was housing computers used for Bitcoin mining.

Icelandic IT firm Advania produced surveillance footage of thieves stealing computers from a data center in Reykjanesbær in January, which positively identified the two men that were in custody, according to local news outlet Visir.

In April, one of the culprits managed to escape from custody and fled to Sweden using a fake passport to board a flight to Stockholm. Sindri Þór Stefánsson later said he would return to Iceland in a statement. He claimed he had the right to travel at the time since his custody ruling had expired on April 16.

To date, Icelandic authorities have been unable to trace the stolen equipment. Police had asked IT service providers, electricians, and storage units in the country to report any unusual spikes in power use in the hopes they could track down the stolen mining computers.

Two months later, Chinese police seized 600 computers in Tianjin in what seems to be more than just a crazy coincidence. The operation caught the attention of Tianjin police after the local power grid operator reported abnormal electricity usage at the location where the equipment was being operated.

Given that the number of computers is exactly the same, there’s a good possibility they could be the PCs from Iceland. Icelandic police have reached out to Chinese authorities to try and link the two cases.

Still need to be connected

Icelandic authorities are still waiting on their Chinese counterparts to respond to their requests for collaboration. If and when they do, it shouldn’t be difficult to link the computer equipment at the very least. Given that the computers were stolen from Advania’s data center, it’s almost certain that the serial numbers of components will be available.

This could then be cross-checked with the computers seized in Tianjin to positively link the hardware. While the owners of the hardware will no doubt be pleased to recover their property, the investigation has the potential to uncover a nefarious crime syndicate.

Icelandic police commissioner Olafur Helgi Kjartansson was quoted saying, “This is a grand theft on a scale unseen before,” adding that it was a “highly organized crime”. With numerous suspects being investigated in both China and Iceland, authorities have the chance to apprehend criminals that are preying on the cryptocurrency community.

Posted on

600 Stolen Bitcoin Miners From Icelandic Heist Suspected To Be In China

The missing machines from an unsolved Bitcoin (BTC) mining hardware theft in Iceland earlier this year may be in China, Icelandic media outlet RUV reported May 5. Icelandic police are reported to have now issued an enquiry to Chinese authorities, after news broke in late April that 600 devices used to mine BTC had been seized in the northern city of Tianjin.

The number of confiscated machines exactly matches that of the missing hardware that was stolen in three burglaries at data centers in Iceland last December and January. Icelandic police were soon able to identify and arrest two suspects in February. One of them now faces an international arrest warrant, after he escaped from an Icelandic prison and fled to Sweden in mid April.

The missing equipment has to date not been found. Its total worth is estimated at 200 million krónur, equal to almost $2 mln. Icelandic police have been monitoring energy consumption locally for abnormal increases without success.

In Tianjin, it was precisely a pattern of highly irregular electricity usage that is reported to have attracted the attention of a local grid operator, leading to the authorities’ confiscation of the suspect mining hardware.

Chinese police have not yet responded to the Icelandic enquiry, according to RUV.

With its cold climate and widespread access to renewable energy, Iceland is a hot spot for crypto mining. Local industry sources have predicted a doubling of the country’s crypto mining energy consumption this year, more electricity than the Iceland’s 340,000 residents will consume for personal use.

Access to geothermal and hydroelectric power plants makes mining in Iceland potentially more environmentally sustainable than in China’s coal-burning mining sites.

The latter has long been a stalwart crypto mining superpower. In 2017, allegedly 50 to 70 percent of BTC mining took place in China. This January, however, news broke of plans to toughen regional regulatory oversight and potentially restrict the power use of miners in future.

Posted on

Iceland's Missing Bitcoin Miners May Be In China

Iceland’s 600 missing bitcoin mining machines may be in China, local news reported last week.

According to RUV, Icelandic police have sent Chinese authorities an inquiry after the latter country confiscated 600 mining computers. Police in the Tianjin area reportedly seized the machines after detecting unusually high electricity consumption, per Xinhua News.

The Chinese news agency explained that this may have been the “largest power theft case in recent years,” noting that eight high-power fans were also confiscated. The individuals running the mining farm short-circuited their electricity meter, thereby avoiding receiving a bill for the energy used to power the miners.

Left untouched, the meter would have recorded “hundreds of thousands of yuan” in bills, Xinhua reported.

However, it is unclear whether the machines seized in China have any relation to Iceland’s “Big Bitcoin Heist.” As previously reported, the machines were stolen across several incidents during December and January, and officials have so far had no luck in locating them. A $60,000 reward is offered by the machines’ owner for any information which could lead to the computers.

The alleged mastermind behind the thefts is set to be extradited to Iceland from the Netherlands, where he was arrested after escaping a low-security prison and fleeing to Sweden.

As previously reported, Sindri Thor Stefansson reportedly took a taxi to a nearby international airport and flew out of the country on an aircraft which also carried the nation’s prime minister.

Mining rigs via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Iceland's 'Big Bitcoin Heist' Suspect Has Been Arrested

Iceland’s now-infamous bitcoin miner thief has reportedly been arrested.

A Dutch police spokesperson confirmed that Sindri Thor Stefansson – who is accused of masterminding the theft of $2 million worth of mining hardware in what’s being called the “Big Bitcoin Heist” – was arrested in the Amsterdam on Sunday night.

Prosecutors are now looking to extradite him back to Iceland, the News Observer reported.

Stefansson walked out of a low-security prison and traveled to Sweden last week, as previously reported. In a letter sent to Icelandic news organization Frettabladid, he claimed he was held “for two and a half months … without evidence,” and kept in isolation during his imprisonment. After his order of detention expired, he left the prison and took a taxi to the airport.

“I simply refuse to be in prison of my own will, especially when the police threatens to arrest me without explanation,” he wrote to the newspaper.

Stefansson did say he wanted to return to Iceland and claimed that he had been negotiating with police to arrange his return. He also threatened to use a fake identification to stay hidden from authorities.

In his letter, Stefansson did not address the 600 computers he was accused of stealing, nor have police given any indication that they have located the missing machines. The owner of the bitcoin mining hardware has offered a $60,000 reward.

The computers were stolen across four separate thefts in what is Iceland’s largest crime to date. Last month, police officials said that “everything points to this being a highly organized crime.”

Police car image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Iceland: $2 Mln Bitcoin Mining Theft Suspect Vows To Return Home After Fleeing To Sweden

The Icelandic man who allegedly stole Bitcoin mining hardware worth $2 mln vowed to return home in a statement reported by local news media outlet Fréttablaðið April 20.

As reported April 18, Sindri Þór Stefánsson had escaped from from Sogni prison and fled Iceland to Stockholm, Sweden. He reportedly used another man’s passport when he boarded a flight at Keflavik International Airport.

In the April 20 statement, Stefánsson said that he was “legally allowed” to travel on the day he boarded the plane to Stockholm.

Having been held in police custody since his arrest in February, Stefánsson said he was within his rights to travel as the custody ruling expired April 16 and a judge required 24 hours to renew it.

According to the statement, the fugitive was “under the threat that the police would arrest him if I left the prison without any explanation.”

“I was forced to sign a paper stating that I was free travel, but if I could, I would stay in a prison room until the extension of custody was approved,” he claims.

Stefánsson’s heist was called by local media “one of the largest criminal cases in Icelandic history.”

Despite apparently being offered the means to continue living abroad despite an international arrest warrant closing in on him, Stefánsson said he “would rather” return home to Iceland and that he “would be there soon.”

He told reporters that he would challenge his two-and-a-half-month custody at the European Court of Human Rights.

As Cointelegraph reported previously, the alleged crime involved various devices being looted from Iceland’s giant data centers involved in cryptocurrency mining operations between December 2017 and January 2018.

Posted on

Alleged Bitcoin Miner Thief Says Police Held Him 'Without Evidence'

The accused mastermind of Iceland’s “Big Bitcoin Heist” says that he was free to travel when he escaped from a low-security prison and flew to Sweden last week.

Sindri Thor Stefansson has been accused of spearheading the theft of 600 bitcoin mining computers– hardware worth roughly $2 million – during incidents between December and January. Stefansson sparked headlines last week after he left the prison on Tuesday and traveled by plane to Sweden on a flight that he reportedly shared with Iceland’s prime minister.

Yet in a letter sent to Icelandic newspaper Frettabladid last week, Stefansson claimed he held with no evidence for months prior to his escape. He further asserted that the order of detention against him expired on April 16, and that when police attempted to extend his custody by another 10 days, a judge deferred that decision for another day. As a result, during the time of the escape, Stefansson claimed, he was legally free to go.

“I simply refuse to be in prison of my own will, especially when the police threatens to arrest me without explanation,” Stefansson was quoted as writing, adding:

“I have been in custody for two and a half months unsuccessfully, without evidence, but only because of police suspicion. That’s what I’m angry about. I have not been published a single testimony and I was threatened and threatened with longer isolation while isolation took place.”

Stefansson’s whereabouts are currently unknown, though police suspect that he is in Spain, according to Frettabladid. The stolen mining machines are still missing and a $60,000 reward for information leading to their recovery remains in effect.

Stefansson said he wanted to return to Iceland, provided that official affirm his status as a free man at the time of his escape.

“I’m working on negotiating with the police in Iceland that I can get home without being arrested abroad,” Stefansson wrote.

Note: Statements in this article were translated from Icelandic.

Jail block image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Bitcoin Mining Hardware Thief Escapes from Prison

The alleged thief behind Iceland’s “Big Bitcoin Heist” has escaped from prison and escaped to Sweden.

Sindri Thor Stefansson, who is accused of stealing 600 cryptocurrency mining computers across at least four separate incidents between December 2017 and January 2018, allegedly flew to Sweden on a flight with Iceland’s prime minister, according to a report from The Guardian published Wednesday.

Police arrested a further 22 individuals as possible accomplices, though it is unclear how many remain in custody.

The heist – which resulted in the theft of an estimated $2 million worth of mining hardware – is the largest in Iceland’s history, as previously reported. At the time, officials called it “a highly organized crime” that was coordinated “on a scale unseen before.”

As such, Stefansson likely had help escaping, local police chief Gunnar Schram was quoted as saying. He told reporters that the alleged criminal “had an accomplice” to help him leave the low-security prison he was being held in and travel to the airport, located some 60 miles away.

The mining hardware has not yet been recovered, The Guardian further reported. The owners of the machines have offered $60,000 as a reward for anyone who can help locate the machines.

While a warrant is out for Stefansson’s arrest in Sweden, his whereabouts are reportedly unknown at this time.

Prison image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Suspect From Iceland Bitcoin Miner Theft Escapes Prison

A suspect being held in connection with a massive Bitcoin miner theft in Iceland earlier this year has escaped prison, local news the Iceland Monitor reports April 17.

Sindri Þór Stefánsson escaped from from Sogni prison last night and police have confirmed that he fled Iceland to Stockholm, Sweden. The fugitive was reportedly using another man’s passport when he boarded a flight at Keflavik International Airport.

By the time police ascertained that Stefánsson had boarded a plane to Sweden, he had already landed. Icelandic police are currently coordinating with Swedish authorities to apprehend Stefánsson. An international arrest warrant has been issued. The suspect is not considered to be dangerous.

Stefánsson had been in custody since Feb. 2 on suspicion of his involvement in a series of burglaries, wherein 600 PCs, 600 graphics cards, 100 power supplies, 100 motherboards, 100 memory discs, and 100 CPU processors had been taken from data centers involved in cryptocurrency mining in the South West and North West of Iceland. The burglaries took place from Dec. 5 2017 to Jan. 16, 2018.

The aggregate value of the stolen items was estimated at 200 million krónur, or $1,990,000. Iceland Magazine called the incident “one of the largest criminal cases in Icelandic history.” While the suspects have been uncooperative and authorities have not yet located the stolen hardware, local news Fréttablaðið reports that local authorities are going to move forward with an indictment at the beginning of next week.

Earlier this month, the Criminal Investigation Department in Gujarat, India began investigating 10 police officers for extorting 200 Bitcoins from a businessman. Sailesh Bhatt alleges that he was beaten, kidnapped and taken to a farm where he was forced to send the Bitcoins to his former business partner.

Posted on

Taiwan Central Bank Governor Suggests Bitcoin Transactions Should Fall Under AML Regulation

The Central Bank of the Republic of China (Taiwan) has recommended that Bitcoin (BTC) trading should be regulated under the Department of Justice’s anti-money laundering (AML) regulations, local news outlet Focus Taiwan reports today, April 2.

In October of last year, Taiwan’s Financial Supervisory Commission (FSC) had shown support for Initial Coin Offering (ICO), cryptocurrency, and Blockchain adoption and innovation within the country.

In response to concerns broached about BTC’s recently falling prices at a meeting with Taiwan’s Legislative Yuan Finance Committee, Yang Chin-long, the governor of the central bank, said that the bank’s “response measures” to the noted “opacity” of BTC transactions are to first remind investors of risks, and then to move towards BTC AML regulation.

Yang Chin-long became governor of the central bank only in February, where he immediately indicated the bank’s friendly attitude towards Blockchain technologies in his speech at the handover ceremony.

Wu Bing-rui, a legislator for Taiwan’s Democratic Progressive Party, also asked Yang Chin-long if there was a need to pay attention to Bitcoin mining in the country, citing the figure that the cost of mining in Taiwan is the third lowest in the world due to low electricity cost.

According to Yang Chin-long, most of Taiwan’s BTC mining technology manufacturers are located in mainland China, but that does not mean that the government shouldn’t pay attention to the effect of BTC mining on Taiwan’s power usage.

Debate about the potential harm caused by cryptocurrency mining’s high energy consumption has recently increased as countries like Iceland – which attracts miners due to its cold climate and access to renewable energy – and US states like Washington – who have low electricity costs – are seeing an influx of miners that are using more energy than regular households and overloading electrical infrastructure.