Amidst an announced crackdown on cryptocurrency miners in the Svaneti region’s municipality of Mestia, the Georgian Interior Ministry said it had seized 148 mining devices from the area. Prime Minister Irakli Kobakhidze has further stated that the process should continue.
The ministry reported the seizure of devices on Thursday, stating that the miners were detected at six different locations. It further noted that local residents had been ‘systematically generating digital currency and obtaining illegal income through the unlawful and illicit consumption of large amounts of electricity’.
The announcement was preceded by remarks from Deputy Prime Minister Mamuka Mdinaradze, who proposed on Monday the metering of electricity consumption in Mestia as a way to tackle what he described as illegal crypto mining.
The state cites cryptocurrency mining as the main reason why electricity lines in the municipality are ‘constantly overloaded’, with Mdinaradze noting that the large amounts of electricity consumed for mining ‘significantly harm’ both the energy sector and local residents and businesses.
Following the police operation, Kobakhidze noted that electricity consumption in Mestia amounts to ‘133 million kWh, while in similar municipalities it does not even reach a double-digit figure [of consumption]’.
‘Electricity worth approximately more than ₾20 million ($7.5 million) is being illegally consumed for mining purposes’, he said on Thursday.
Mestia, which is part of Georgia’s mountainous Svaneti region, has had free electricity since the 1990s, making it attractive for crypto mining.
According to Mdinaradze’s statement, even after the introduction of metering, electricity in Mestia will remain free ‘within the maximum necessary amount, while a limit will be set above that amount, and a corresponding tariff will apply’.
After the government began discussing efforts to eliminate cryptocurrency mining in Mestia, opposition politician from the United National Movement (UNM) Levan Khabeishvili hinted from prison that mining activities in the municipality were being overseen by Viktor Japaridze, an MP from the ruling Georgian Dream-aligned allied party People’s Power.
Japaridze has denied the allegations.
The Interior Ministry emphasised that an investigation is ongoing to identify individuals ‘involved in the crime’, who could face up to three years in prison if found guilty.
