Brazilian law enforcement authorities have arrested a suspect allegedly involved in a Bitcoin money laundering scheme.

While chasing a drug trafficker, the agents unexpectedly discovered a hidden cryptocurrency mining facility, according to local media outlet Gauchazh.

A Surprising Discovery

The State Department of Drug Trafficking had been chasing a suspected drug trafficker when suddenly they came across a clandestine Bitcoin (BTC) mining farm in Porto Alegre in southern Brazil.

The police suggest that the criminals had been using digital currencies to launder their illegal revenues. According to the report, the finding is rather unusual for this region as local drug traffickers traditionally use different methods for money laundering.

In a meager apartment where the unnamed man was arrested, there were 25 cryptocurrency mining machines. Their value was estimated at approximately $63,000. The sophisticated and expensive equipment operated on a round-the-clock basis in a small nonventilated room.

The man claimed he was the owner of the farm and that he had rented the space to mine Bitcoin as an investment. However, he denied any accusations of his involvement in any organized crime scheme dealing with drugs.

Usual Suspects

It is still unclear whether the man has any connection to the drug trafficking ring, but police are determined to continue the investigation. The law enforcement authorities stress that the uncovered mining facility is located in an area where drug traffickers are very active. They also pointed out that the place is well-hidden. Meanwhile, the man in custody is known by the police to own an unlicensed firearm.

The chances are high that the suspect had in fact been collaborating with drug dealers and laundering their money with the help of Bitcoin, the authorities said.

For the time being, he is only accused of stealing electricity to power his mining facility and was fined for illegal connection to energy sources. The equipment has been seized because the police suggested that it may have been smuggled from China.

Unfortunately, this is not the first time that cryptocurrencies have been linked to criminal activities. Nevertheless, as other reports confirm, most Bitcoin use cases are not related to illegal and nefarious acts. Quite the contrary, as blockchain-based technologies are increasingly gaining popularity for charitable purposes.

Do you believe that reports of crime tied to Bitcoin compromise the credibility of cryptocurrencies? Let us know your thoughts in the comments below!