Malaysia is grappling with a pervasive surge in illicit cryptocurrency mining, primarily driven by electricity theft. State-owned power utility Tenaga Nasional Berhad (TNB) has revealed staggering cumulative losses amounting to RM 4.57 billion (approximately US$1.1 billion) over the past five years due to these illegal operations. This alarming figure has compelled the Malaysian government to significantly enhance its enforcement strategies, deploying advanced smart monitoring systems to apprehend these “electricity thieves” comprehensively.

In a detailed written response to Melaka City Member of Parliament Khoo Poay Tiong, Malaysia’s Ministry of Energy Transition and Water Transformation (PETRA) disclosed that TNB has uncovered a remarkable 13,827 illegal electricity theft sites between 2020 and August 2025. These operations illicitly siphon vast amounts of electricity for Bitcoin and other cryptocurrency mining through methods such as meter tampering and unauthorized wiring.

The Ministry emphasized that these illicit activities not only plunder national resources but also pose a severe threat to Malaysia’s critical power supply system, public safety, and overall economic stability.

Intensified Crackdowns and Innovative Enforcement

Malaysian authorities initiated their crackdown on illegal mining operations as early as 2018, aiming to curb soaring electricity costs. Enforcement efforts have intensified dramatically in recent years. A notable instance occurred in August 2024 when local law enforcement deployed a “roadroller” to obliterate 985 Bitcoin mining rigs, crushing equipment with an estimated market value of RM 1.97 million (approximately US$450,000) into scrap metal.

To combat these crimes with greater precision, the Ministry of Energy revealed in a recent document that TNB has established a sophisticated internal database. This database compiles crucial information on properties and tenants suspected of electricity theft, serving as a vital tool for identifying and monitoring suspicious locations and executing targeted raids.

On the technological front, TNB has extensively deployed smart meters across its network. Furthermore, it is piloting a “distribution transformer meter” monitoring program at substations. This initiative leverages higher-resolution electricity consumption data to detect and trace abnormal power flows, enabling the utility to intercept problems promptly before they escalate.

Strict Penalties Under Malaysian Law

While operating a Bitcoin mining business in Malaysia is not inherently illegal, electricity theft is subject to stringent legal restrictions. According to the Malaysian Electricity Supply Act, any unauthorized tampering with power lines that leads to or could potentially cause loss of life or property constitutes a criminal offense.

Upon conviction, offenders face severe penalties, including fines of up to RM 1 million (approximately US$220,000) or imprisonment for up to five years. For more serious offenses, the penalties can escalate to a fine of RM 5 million (approximately US$1.14 million) or imprisonment for up to ten years, or both.