Bitcoin heist: Iceland computers stolen
REYKJAVIK — About 600 computers used to “mine” bitcoin and other virtual currencies were stolen from data centres in Iceland in what police say is the biggest series of thefts ever in the North Atlantic nation.
Eleven people were arrested, including a security guard as part of what Icelandic media have dubbed the “Big Bitcoin Heist.” A judge at the Reykjanes District Court on Friday ordered two people to remain in custody.
The powerful computers, which have not yet been found, are worth almost $2 million. But if the stolen equipment is used for its original purpose — to create new bitcoins — the thieves could turn a massive profit in an untraceable currency without ever selling the items.
“This is a grand theft on a scale unseen before,” said Olafur Helgi Kjartansson, the police commissioner on the southwestern Reykjanes peninsula, where two of the burglaries took place. “Everything points to this being a highly organized crime.”
Three of four burglaries took place in December while one took place in January, but authorities did not make the news public earlier in hopes of tracking down the thieves.
Bitcoin is digital money that isn’t tied to a bank or a government. It has been hugely volatile, posting some dizzying intra-day rises and falls over the past year or so. The price of a single bitcoin rocketed to $20,000 US late last year and then plunged this year. On Friday, it was trading just below the $11,000 US mark.
Bitcoin and other cryptocurrencies rely on the blockchain, the name given to the public, distributed ledgers that track the coins’ ownership. The Bitcoin ledger is powered by miners, socalled because they throw computational power into the system, occasionally receiving — or “mining” — new bitcoins in return. Drumming up that computational power usually means lots of computers — and thus lots of electricity.
That desire for energy has created a gold rush for bitcoin in Iceland. Traders searching for cheap energy have been flooding into the island to take advantage of geothermal and hydroelectric power plants. Police tracking the stolen computers are monitoring electric consumption across the country in hopes the thieves will show their hand.