In a bizarre incident, the principal of a Chinese school was sacked for running a cryptocurrency mining operation using the school’s electricity and internet.
The Lure of Mining
The principal of a school in China has been sacked from his job, and his deputy given a warning after both were found guilty of using the school’s electricity and the internet to carry our cryptocurrency mining within school premises.
The queer incident was reported earlier by the South China Morning Post. According to the article, the mining operation which had been running for over a year incurred a massive electricity bill amounting to 14,714 yuan (US$2,120) for the school.
How It All Started
Lei Hua, Principal, Puman Middle School in Chenzhou, Hunan province decided last year to mine Ethereum, the second largest cryptocurrency by market capitalization.
He spent 10,000 yuan (US$1,440) on buying a mining rig, only to find that he could not afford to pay for the power that the machine was consuming.
He shifted the miner to one of the school’s dormitories and started mining using up the school’s electricity and internet. Lei further added seven more machines and put them up in the electronics lab of the school. The power consumption by his mining rigs added up to over 14,714 yuan for a 12-month period ending July this year.
Not to be left behind Lei’s deputy Wang Zhipeng motivated by his boss’s success bought a mining rig and with Lei’s permission set it up in the physics lab. His power bill added up to 2,444 yuan for the school.
How the Theft Was Caught
The massive power drain caused by the 24-hour mining operation began to strain the power cables and almost caused a fire according to the article. Also, the internet speed in the classrooms slowed down.
When the teacher in charge for school administration noticed the surge in electricity bills and reported the matter to Lei, he was turned away. Lei played it down by attributing the high bills to use of air-conditioning or overuse of heaters.
Other teachers too complained about the continuous noise in classrooms at night and slow internet. The resulting search led to the discovery of the mining machines.
Lei was reportedly sacked while Wang was let off with a warning by the communist party. The profits earned by the duo were also confiscated by the party’s anti-corruption wing.
China is home to the most prominent mining equipment manufacturers like Bitmain and Chinese firms control a significant portion of the hashrate in the mining of Bitcoin and other cryptocurrencies. However, the Chinese government has come down heavily on the cryptocurrency industry.
Last year the government banned cryptocurrency trading, and since the beginning of this year, authorities have taken measures to curb mining activities and block citizens from accessing exchanges outside China as well. However, incidents like this prove that the lure of a passive income through cryptocurrency mining is hard to resist, even for the Chinese citizens, who are supposed to be under surveillance.
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