Mining Express data centre in Ukraine had mining equipment seized

In late January, in Kropyvnytskyi, officers of the Security Service of Ukraine (SBU) изъяли an unspecified amount of equipment for cryptocurrency mining from premises belonging to the Mining Express data centre. ForkLog confirmed the information about the searches with Sergei Smirnov, a partner at the Sayenko Kharenko law firm.

According to the lawyer, the investigative actions lasted four days.

The press service of the Kirovohrad Oblast Police told ForkLog that the operation was conducted by SBU officers.

ForkLog requested comment from the SBU and Mining Express.

According to court documents, since May 2021 Mining Express has been under pre-trial investigation in Ukraine on the facts of fraud.

The first search of the data centre took place from June 7 to June 8. At that time, investigators found:

• on the first floor: 4,880 Nvidia P102 GPUs for mining;
• on the second: 4,543 systems, including 506 Nvidia P102 GPUs, 3,018 GPU models P102 Bokka Serv and 1,019 power-supply units Kenweiipc AntMiner;
• on the third: P106, P102 Bokka Serv and P102 Crypto Mining System, as well as 2,086 mining rigs with GPUs.

They also found notebooks, rough notes, computer equipment and networking gear.

On 15 June 2021, the Pechersky District Court of Kyiv arrested equipment belonging to Mining Express. The property was placed in safekeeping with the head of the information technology department of LLC “Mining Express”.

The company tried to challenge this decision, but in October 2021 the Kyiv Appellate Court refused to lift the seizure.

In ForkLog’s comments, experts noted that the GPU models listed in the court documents are outdated.

Mining Express is registered in Kyiv in March 2018. Its data centre is located in the building of the former canteen of the Pishmash-typewriter plant in Kropyvnytskyi. The founder, with a registered capital of 100,000 hryvnias, is Edelweiss Investment Trading Company from Hong Kong, and the ultimate beneficial owner is Carlos Fuziyama, a Brazilian of Japanese descent.

At the opening of the data centre, Fuziyama said that his mining farm consists of 17,000 GPUs and that he has invested more than $100 million in it.

The first partners of Fuziyama in Ukraine are entrepreneurs from Ivano-Frankivsk, Aleksei Kolesnik and Nikolai Maksimiv, whom he knows from international MLM business. Mining Express also used network marketing in its business model and operated on a principle similar to pyramid schemes.

In December 2020, Brazil’s Securities and Exchange Commission (CVM) initiated an administrative proceeding to investigate possible violations by the company. Despite being registered in Ukraine, Mining Express advertised in Brazil, using a Portuguese-language site, and attracted locals to its project.

The founder of the Ukrainian bitcoin exchange Kuna, Mikhail Chobanian, said in his Telegram channel that in 2018 Carlos Fuziyama approached Blockchain Hub and offered money for PR of Mining Express on the Ukrainian market.

As reported in June 2019, representatives of the Mining Express data centre said that, due to waning interest in mining, they began using the equipment for cloud video rendering.