Venezuelan authorities have confiscated an array of Bitcoin mining machines from Tocoron prison. The operation involved over 11,000 police and soldiers, backed by tanks and armored vehicles. They stormed the prison to seize not just the mining machines but also a stockpile of heavy weaponry. The arsenal included rocket launchers and grenades, all belonging to the Tren de Aragua gang. This criminal organization had been using the prison as its Latin American headquarters for years.
Bitcoin mining has gained popularity in Venezuela due to the country’s hyperinflation and near-zero electricity costs. However, many of the seized machines appeared to be older versions of Bitmain’s Antminers. This raises questions about the profitability of the operation, although the article does not delve into this aspect.
Government crackdown on crypto mining
Venezuelan authorities have been increasingly vigilant about crypto mining activities, especially given the country’s frequent electricity blackouts. A temporary ban on mining cryptocurrencies has been in effect since March, following an investigation into an alleged corruption scheme. This scheme reportedly involved the use of crypto wallets to siphon funds from the state-owned oil firm PDVSA. The ban has effectively stifled an industry that was once promoted within the country.
The crackdown on crypto mining is not the government’s first foray into the world of digital currencies. In 2019, President Nicolas Maduro announced plans to back the national cryptocurrency, the Petro, with barrels of oil. However, this initiative has not gained significant traction.
Besides the mining machines and weapons, the raid revealed a shocking lifestyle enjoyed by the gang members in prison. Interior and Justice Minister Remigio Ceballos stated that four prison guards were arrested on suspicion of aiding the gang. The prison’s facilities, installed by the gang, were far from ordinary. They included a restaurant, pool, gambling rooms, disco, and even a baseball field and a zoo. Some inmates’ partners also resided there and were evicted during the operation.
The raid led to the evacuation of the prison’s 1,600 inmates to other locations. However, some managed to escape during the operation. Minister Ceballos also revealed that the gang leaders kept other prisoners in “a kind of slavery,” further highlighting the complex and troubling dynamics within the prison.
The operation also led to the seizure of additional items such as sniper rifles, explosives, bullets, and machine gun ammunition belts.