Illegal crypto mines have been dismantled in Libya

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Libyan authorities are cracking down on illegal cryptocurrency mining.

On Thursday, local media reported that up to fifty Chinese nationals had been arrested in connection with the raid on a crypto farm in the town of Zliten.

Illegal mining discovered in abandoned iron factory

The latest bust follows the discovery by law enforcement of similar underground crypto farms in Misrata and Tripoli earlier in the week.

Footage circulating online appears to show a sprawling industrial building outfitted with rows of server racks that could be used to mine Bitcoin or other cryptocurrencies. According to the Italian newspaper Agenzia Nova, Zliten’s farm operated from an abandoned iron factory.

Libyan Authorities Raid Illegal Crypto Mining Operation (Source: Twitter) Libya Becomes Regional Mining Hub Despite Crypto Ban

Libya’s central bank has technically banned crypto due to perceived money laundering risks. But in recent years, the country has become a hotbed of underground mining activity thanks to its cheap electricity.

According to one source, in September 2022 electricity prices for Libyan households were as low as USD 0.01 per kWh. The global average price during this period was USD 0.17 per kWh.

Moreover, economic opportunities are severely limited in this war-torn and politically divided country. It is therefore not surprising that some Libyans are turning to illegal crypto mining as a source of income.

In fact, the University of Cambridge’s Bitcoin Electricity Consumption Index found that in 2021-2022, Libya accounted for between 0.13% and 0.17% of the global average monthly hashrate.

Of course, this still puts Libya far behind the biggest Bitcoin miners in Russia and the United States. But the country nonetheless mines crypto at a much higher rate than some of its more populous neighbors.

Libyan Government Blames Bitcoin Farms For Power Outages

The energy needs of crypto mining are such that the Libyan government has even blamed bitcoin farms for outages in the country’s national power grid.

Power cuts are such a problem in Libya that protests erupted in Tripoli and Benghazi last year. With blackouts lasting up to 24 hours at a stretch, citizens took to the streets to protest the government’s handling of the situation.

And although the situation has stabilized somewhat since last year, the ongoing conflict continues to threaten Libyans’ electricity supply.

In this context, Prime Minister Abdul Hamid Dbeibeh tried to deflect blame by linking the power cuts to illegal Bitcoin mining.

In November, he claimed the practice was draining between 1,000 and 1,500 megawatts from Libya’s power grid. Moreover, he anticipated the latest crackdown by arguing that the absence of authorities had allowed illegal mining to proliferate.

Disclaimer

In accordance with the guidelines of the Trust Project, BeInCrypto is committed to providing impartial and transparent reports. This news article aims to provide accurate and timely information. However, readers are urged to independently fact-check and seek professional advice before making any decisions based on this content.

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