Government Head of IT Department Fired for Mining Bitcoin Using State-Owned Computers in Crimea

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Two government officials of the Crimean Council of Ministers were caught mining bitcoin using government computers and were subsequently fired. They reportedly installed “malicious software” on the government’s server and programmed over a dozen computers to mine bitcoin.

Also read: Russia Proposes Adding Cryptocurrency to the Population’s Financial Literacy Strategy

Government Employees Caught Mining

Government Head of IT Department Fired for Mining Bitcoin Using State-Owned Computers in Crimea
Alexander Akshatin.

The Chairman of the Anti-Corruption Committee of the Republic of Crimea, Alexander Akshatin, said at a press conference last week in Sevastopol that two employees of the Crimean Council of Ministers were caught mining bitcoin using government properties, RIA Novosti reported. One was the head of the IT department and the other was the department’s head of hardware and technical support. Both were subsequently dismissed, Akshatin revealed, adding that:

They put malicious software on the server of the Crimean government, which opened access to the information stored on it. Concurrently, more than a dozen computers in the basement of the building were also used which gave this same access.

Fired Before Cashing Out

Government Officials Fired for Mining Bitcoin Using State-Owned Computers in CrimeaAkshatin detailed that his committee and the Russian Federal Security Service (FSB) were able to identify the activities of the Council of Ministers’ employees in time and subsequently fired them before they had time to cash out. As for how much they were able to mine, he said, “I cannot exactly say, but less than one bitcoin.” He then noted that “in February-March 2017, a bitcoin was $1800, now it costs $4000. Even half a bitcoin is some money.”

“They thought that there was nothing wrong with that,” Akshatin told the press. “But if we were not on the alert and some limited information went through this channel, you understand the extent to which this could all turn out. Fortunately, this did not happen.” He believes that their dismissals will deter anyone from doing the same in the future.

Cryptocurrencies in Crimea

In July, the Russian Deputy Finance Minister Alexei Moiseev said on the “Russia 24” TV channel that the ministry was ready to consider allowing the circulation of cryptocurrencies in Crimea in order to “stimulate foreign tourism,” Tass reported at the time. He was quoted saying:

People say, let’s ban cryptocurrencies…it will not work. People will continue to use bitcoins in a cafe as cash.

Government Officials Fired for Mining Bitcoin Using State-Owned Computers in Crimea
Alexei Moiseev.

President Vladimir Putin’s internet ombudsman, Dmitry Marinichev, also proposed allowing the use of cryptocurrencies in Crimea, according to Lenta. He said in February that the establishment of cryptocurrency exchanges in Crimea would attract new investments into the region.

When the Deputy Finance Minister suggested using digital currencies to attract tourists into the region, Russia was working on a bill to regulate cryptocurrencies. The bill was supposed to be introduced last month, but was delayed due to a lack of consensus. Following the National Council for Financial Stability meeting last week, headed by First Deputy Prime Minister Igor Shuvalov, the authorities decided to postpone their plans to regulate cryptocurrencies to next year.

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