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Researcher Suspended for Mining Bitcoins with NSF-Funded Supercomputer

reportAs reported in Bitcoin Magazine, a researcher has been suspended for using NSF-funded supercomputers to mine Bitcoin. The news surfaced in the March 2014 NSF Semi-Annual Report to Congress.

We received reports describing a researcher’s abuse of NSF-funded supercomputing resources at two universities to conduct bitcoin mining activities. Bitcoin is a virtual currency that is independent of national currencies, but it can be converted into traditional currencies through exchange markets. It is generated or “mined” through a process that is by design computationally intensive. 30 InvestigationsThe researcher misused over $150,000 in NSF-supported computer usage at two universities to generate bitcoins valued between $8,000 and $10,000. Both universities determined that this was an unauthorized use of their IT systems. The researcher asserted that he was conducting tests on the computers, but neither university had authorized him to conduct such tests — both university reports noted that the researcher accessed the computer systems remotely and may have taken steps to conceal his activities, including accessing one supercomputer through a mirror site in Europe. The researcher’s access to all NSF-funded supercomputer resources was terminated. In response to our recommendation, NSF suspended the researcher government-wide.

As noted in the Report to Congress, NSF-funded supercomputers are expensive resources. But as powerful as they are for their target applications, they cost much more to operate in a given day than any bitcoins they might mine out.

Download the Report (PDF)