Suspected Cannabis Farm Turns Out To Be A Bitcoin Mining Farm

Police in Sandwell in the West Midlands recently discovered a warehouse that had been converted to an operation to illegally supply large quantities of electricity for Bitcoin mining.

Same Heat & Electricity Profile as a Cannabis Farm

The warehouse was raided by police after the heat generated, which had been spotted by the heat camera on a police drone, and the excessive electricity consumption appeared to show all the hallmarks of a cannabis farm.

The find, the second of its kind in the area, showed that criminals have adapted an existing money-generating model to tap into a technological rather than a biological fast money-making scheme that essentially cuts out the middlemen and delivers direct profit with fewer risks.

Illegal Electricity Supply

The criminals were found to have made an illegal connection to the electricity supply from Western Power in order to power the 100 computer units that were discovered in the warehouse.

Bitcoin Mining

Bitcoin “mining” uses specialised Bitcoin computers that are constantly powered on and connected to the cryptocurrency network to verify transactions (sending and receiving of the Bitcoin cryptocurrency).  This verification is achieved by the computers solving puzzles to prevent fraud and to win small amounts of Bitcoin. The whole process is extremely energy hungry. In fact, Researchers from Cambridge recently highlighted how Bitcoin mining consumes 21.36 terawatt-hours (TWh) a year, meaning that if Bitcoin were a country, its energy (electricity) consumption would be ranked above Argentina and the energy could power all the kettles in the UK for 27 years.

Three People Suspected

Three people, who were described by a witness (on the Birmingham Live website) as looking “a bit nerdy and dodgy” had apparently been noticed visiting the warehouse unit at the Great Bridge Industrial Estate, Tipton, at odd hours over the past 8 months.  The warehouse unit was reported to have suspicious-looking wiring and ventilation ducts visible from the outside.

Bitcoin Mining Not Illegal

Although Bitcoin mining is not illegal, the way the criminals obtained the electricity for the operation, which was estimated to have used thousands of pounds worth of power does appear to have been illegal.  Also, damage to the unit through its conversion to crypto-mining farm is yet to be assessed.

What Does This Mean For Your Business?

Criminals, particularly in the tech world, are always looking for scams and schemes that deliver maximum profit for minimum ongoing effort, whilst maintaining their anonymity and keeping their distance (often the other side of the world) from their crimes. This scheme shows how criminals have tried to be smart (in the technical sense) by using an existing idea (taking over a building and an electricity supply) to make a fast profit with middlemen from a currency that would be very difficult to trace back to them through the online technical route. Their mistakes, however, appeared to be that they failed to take account of elements in the real-world (i.e. the heat generated that could be spotted by police surveillance). Also, although they are likely to have made money by keeping their distance online but the wiring, setting up and monitoring of the warehouse meant that they had to remain physically too close to their crime, which in this case is the theft of electricity.

This story illustrates how tech-based criminals are finding ever-more creative and sophisticated ways to exploit opportunities and make money, and businesses should, therefore, focus on making their cyber-defences as robust as possible using tried and tested methods to stop any basic breaches, however creative the methodology.