Libyan authorities will imprison underground miners

A new wave of crackdown on illegal cryptocurrency mining has begun in Libya. The country's Attorney General's Office announced a shift to criminal penalties for underground miners, replacing the previously ineffective fines.

Tougher Penalties

In November, a court in Zliten sentenced nine people to three years in prison for setting up an underground Bitcoin mining operation at a steel mill. Furthermore, the convicted individuals had their mining equipment confiscated and their assets transferred to the state. This decision marked a significant step in the fight against illegal cryptocurrency mining in the country.

Ban on Cryptocurrency Mining and Circulation

Cryptocurrency mining and circulation have been banned in Libya since 2018. The Central Bank of Libya (CBL) justified this ban by citing risks associated with money laundering and terrorist financing, stating that digital assets are not legal tender and lack legal protection. Additionally, the Ministry of Economy restricted the import of mining equipment.

The Problem of Illegal Mining

According to prosecutors, nearly 1.3% of Libya's population owns digital assets and can engage in prohibited activities due to the country's near-100% internet penetration. However, as Tripoli-based legal expert Nadia Mohammed explained, current laws do not criminalize the mining process itself. Miners are prosecuted not for cryptocurrency mining, but for related offenses, such as illegally connecting to power grids and stealing electricity.

Impact on the Power Grid

According to the state-owned energy company GECOL, illegal mining farms consume more than 2% of the country's total electricity output. This places an additional burden on Libya's already overburdened power grid.

Previously, Libyan law enforcement agencies dismantled several illegal mining farms in the west of the country, detaining approximately 50 Chinese citizens and seizing approximately 100,000 devices. These actions underscore the authorities' serious approach to combating illegal mining and its impact on the country's economy and security.