A New York City Education Department Employee Got Caught Mining Bitcoin at Work

It doesn't appear as though he got fired.

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Jul 31 2017, 8:42pm

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A New York City Department of Education employee has been punished for mining bitcoin at work.

Mining bitcoin—or the process of validating blockchain transactions and releasing new coins—takes a serious amount of computing power. A single bitcoin transaction now requires more energy than an entire American household uses in a day. In 2017, it's extremely difficult to mine the world's most popular cryptocurrency without investing in expensive and space-hogging hardware.

In order to get around these limitations, one entrepreneurial man decided he would simply mine bitcoin at NYC's Department of Education, where he's worked as a computer systems manager for over a decade. Unfortunately for Vladimir Ilyayev, he was caught and fined four vacation days (worth an estimated $611) by the New York City Conflicts of Interest Board (COIB), according to a recently published disposition.

According to the document—which bears his signature—Ilyayev installed a bitcoin mining program that ran at night that he could monitor from his home. Ilyayev admitted to "mining software on my DOE computer from 6:00 p.m. until 6:00 a.m. every night from March 19, 2014, until April 17, 2014, when my bitcoin mining software was shut down by the DOE's Division of Instructional and Information Technology."

The disposition also makes it clear how determined Ilyayev was to get in on the cryptocurrency gold rush. It indicates that he made "five or six" initial attempts to install bitcoin mining tech, and each time was "thwarted by the DOE security software." Eventually though, Ilyayev was able to bypass his employer's security protocols, at least for a short while. The disposition does not explain how he accomplished this.

The DOE fined Ilyayev not just for misusing the DOE's computers, but also because he was making money, or engaging in a "profit-making activity" during work, which violates city regulations.

This isn't the first time a government employee has been caught mining bitcoin while on the job. In 2014, Rishard Chapoteau, who also worked at NYC's Department of Education, was caught attempting to mine bitcoin via a "Raspberry Pi computing device" that he stashed in a network closet.

In fact, according to his disposition, Chapoteau tried to install bitcoin mining software at the exact same time Ilyayev was running his. Unlike Ilyayev however, there is no evidence Chapoteau "successfully obtained bitcoin," according to his statement, therefore he wasn't fined.

Last year, a former Federal Reserve employee was also reprimanded for installing bitcoin software on his work computer. In January, he was convicted of a misdemeanor, fined $5,000, and sentenced to 12 months probation.