Kyiv Man's Illegal Bitcoin Farm Outside Zhytomyr Cost Power Company Nearly $60,000

Cryptomining Schemes Uncovered: Kyiv Man's Illegal Bitcoin Farm Costs Power Company Millions

Authorities have apprehended a 41-year-old Kyiv resident for orchestrating an illicit cryptocurrency mining operation on the outskirts of Zhytomyr. The sophisticated scheme, which involved illegally tapping into the power grid to circumvent electricity meters, has inflicted substantial financial losses, estimated at nearly 2.3 million hryvnias, on the local energy provider. This brazen act highlights a growing trend of sophisticated criminal enterprises exploiting energy resources for personal gain.

The Genesis of an Illegal Enterprise

Driven by a desire to amplify profits from his existing crypto ventures, the suspect embarked on this illegal pursuit in 2024. He secured a seemingly innocuous warehouse on the city's periphery, strategically positioning it near a transformer substation to ensure a robust power supply. The crucial, yet illegal, element of his plan involved bypassing legitimate electricity consumption tracking. He ingeniously rigged the electricity meter with a specialized device, enabling remote manipulation. This allowed him to selectively block the meter's accounting processes and falsify the data transmitted to the utility company, effectively stealing electricity with impunity.

Scale of the Operation and Legal Repercussions

Law enforcement officials estimate that between October 2024 and June 2025, this clandestine operation consumed over 365,000 kilowatt-hours of electricity without any form of payment. A thorough investigation, culminating in raids on both his residence and the mining facility, led to the seizure of dozens of mining rigs, substantial computer equipment, and irrefutable evidence of the illegal power connection. A criminal case has been initiated under Part 2 of Article 188-1 of the Criminal Code of Ukraine, pertaining to the theft of electricity through the obstruction of its metering, resulting in significant financial damages. The man has been formally notified of his suspicion and faces a potential prison sentence of up to three years. The investigation is proceeding under the procedural guidance of the district prosecutor's office, with active participation from the Security Service of Ukraine (SSU) in the Zhytomyr region.

A Persistent Problem Across Ukraine

This is not an isolated incident; similar illicit mining operations have been uncovered in various regions across Ukraine. In the Kharkiv region, a clandestine crypto-mining hub was discovered last year, also operating from a leased industrial space and illegally connected to state power grids, consuming hundreds of thousands of kilowatt-hours monthly and causing considerable financial harm. Three years prior, the SSU dismantled a similar underground mining farm in Odesa, which had also resulted in multi-million hryvnia losses for the state. A year before that, a comparable operation was identified and neutralized in Kryvyi Rih. Furthermore, more recently, investigators in the Kyiv region exposed a related scheme involving employees of "Ukrzaliznytsia" (Ukrainian Railways). These state enterprise employees, in conjunction with an accomplice, had been covertly mining cryptocurrency, leveraging company resources and untracked electricity. The preliminary damage in that case was estimated at over 1.7 million hryvnias. Ironically, such endeavors can sometimes backfire spectacularly. Four years ago, the SSU mistakenly shut down what was believed to be a mining farm, only to discover it was a legitimate IT company that had been legally purchasing its electricity – a stark reminder of the complexities involved in investigating such cases.