The Bitcoin situation in Venezuela remains tense for the time being. Federal police officials have arrested four individuals who were running a Bitcoin mining operation in the country. All four individuals are accused of electricity theft and internet fraud, even though it remains unclear how the police wants to prove those claims. Considering how the country is struggling economically, it is not surprising to see an increase in Bitcoin interest.
It has to be said, the four people arrested ran a large-scale Bitcoin mining operation. It appears they operated over 300 mining devices, and they may have positioned themselves as resellers of Bitcoin mining equipment as well. Operating 300 machines draws a lot of electricity, and will eventually result in unwanted attention from the government.
Electricity is a very cheap commodity in Venezuela, which makes it an appealing region to set up mining operations. Unfortunately, the government does not think along the same lines, despite how Bitcoin could be quite positive for the local economy. Considering how all four suspects are charged with electricity theft, to the question bonuses if they paid for this resource through legal means. So far, there is no evidence pointing towards stealing electricity by any means, though.
It appears there is a different reasoning behind these arrests. The four suspects
sold Bitcoin mining, hardware in the Colombian border town of Cucuta. This particular location has been a thorn in the side of the Venezuelan government for quite some time now. Allegedly, a lot of Venezuelans go to this city to freely trade bolivars and dollars, effectively bypassing the government’s strict currency controls. Considering how these four sell mining hardware, their accepted methods of payment may have gotten them into contested legal waters.
Moreover, federal investigator Douglas Rico claims these four individuals “threatened the consumption and stability of electricity services”. Quite a strong statement, although it is not the first time we hear about these things. Two other Bitcoin miners were arrested in Bolivia in the year 2015 and held captive for three and a half months. Eventually, the charges were dropped, as there was no credible evidence to back up these claims.
It is evident Bitcoin mining in Venezuela has become a dangerous operation. While it is not difficult to see why this opportunity is so appealing, despite the obvious disadvantages. Operation using up a lot of electricity can cause shortages throughout the country, which is reason enough for the federal police to start an investigation. That said, the Venezuelan government has vilified Bitcoin mining operations, which only add more fuel to the proverbial fire.
One way to circumvent this scrutiny is by hosting Bitcoin mining operations in an industrial area. Unfortunately, that process is not necessarily straightforward for most mining operations. For the time being, the situation in Venezuela will remain uneasy, especially where Bitcoin mining is concerned. It is unclear what will happen to these four suspects, though.
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