Man Faces a 15-Year Jail Term for Allegedly Mining Bitcoin Inside a Government Building

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A man going by the name Christopher Naples who was an IT operations supervisor at a county clerk’s office in Riverhead, New York is facing a 15- year jail term for secretly installing over forty bitcoin mining equipment inside a government office building.

Naples, the owner of the illegal mining rigs, hid them in various rooms across the building resulting to a hiked electricity bill of over $6000 at the county houses. This colossal bill raised an alarm that led to his discovery.

What is ‘Mining’ in the Cryptoverse?

Mining,’ a popular term in the cryptoverse, is the production of new blocks in a blockchain. For example, for each block of Bitcoin, there are 6.25 BTC, and it takes about 10 minutes to produce one block.

For the block to be considered ‘mined,’ people (AKA Miners) with high computing power must solve cryptographic equations. The first miner to get the answer receives the coins in the block as their mining reward. 

The cryptographic equations are made using the SHA-256 algorithm, developed by the NSA. Additionally, the result of this algorithmic encryption is a 64-bit hexadecimal string called a hash. The hash is vital in the validation of blocks, and it is what makes the blockchain immutable. 

Why did Mr. Naples get in Trouble for Mining Bitcoin?

Bitcoin mining utilizes a lot of energy. Back in 2010 through 2013, when BTC was new and only popular in the Silk Road (a Dark Web marketplace), mining BTC was easy using regular computer CPUs.

However, over time, as people competed to add more computing power, the difficulty of mining a single block of BTC skyrocketed. Presently, mining BTC requires Graphical Processing Units (GPUs), powerful (and electricity consuming) equipment. The GPUs are what caused Mr. Naples problems.

A standard mining GPU consumes about 1300 Watts per day. Given that Mr. Naples had 46 of these bad boys, he was using a total of about 59 kW per day. Given that the average electricity price in most US states is about $13 per kW, Mr. Naples racked up over $6,000 in electric bills for the county clerk’s office. Mr. Naples, 42, had been mining BTC and altcoins since February of 2021.

As it turns out, this amounts to misuse of public property, among other crimes.

Bitcoin’s Energy Consumption is a Problem?

Lately, Elon Musk, the founder of Tesla, has criticized Bitcoin mining because of the energy required to mine it. Most electricity usually comes from burning fossils (supplemented by wind and water). The more Bitcoin mining gains popularity, the more the electricity requirement. Hence, more fossils get burnt, which is not good for the environment. 

On the other hand, some have dismissed Mr. Musk as trying to market his solar power energy alternative by criticizing BTC’s current mining methods. 

Bitcoin Mining Consequence

Without a doubt, Mr. Naples will have a pretty hard time getting out of this lawsuit. The government is going to take stern action against him as a warning to other crypto miners. It is well known that SEC has been trying to regulate BTC without success. Our best wishes are with him.