$6 million crypto mine is owned by an NYU student — mine was bought with crypto to mask source funds from China

27 December 2023

in Mining

Reading Time: 2 mins read

Cryptocurrency mining operations hidden in plain sight have become surprisingly common everywhere, from Polish court buildings to school crawl spaces. Now, we have yet another clandestine mining operation to add to the list: The New York Times reported that a crypto mining farm based in Texas valued at over $6 million is actually owned by a New York University college student named Jerry Yu.

Jerry Yu’s company, known as BitRush Inc. or BytesRush, used cryptocurrency to buy a Texas computing center, thus masking the source of the investment, which originated in China, to avoid regulatory scrutiny. Yu was responsible for compensating contractors for their labor on this multi-million dollar project.

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According to lawsuits from various contractors and the Texas-based Crypton Mining Solutions company, BitRush refused to pay for electrical and plumbing work until a full work stoppage forced them to pay. These lawsuits have also brought much more scrutiny to Jerry Yu and BitRush.

Based on documents shared with NYT by a Crypton Mining Solutions lawyer, the Channing, Texas site was purchased for $6.3 million in the Tether cryptocurrency. Tether is supposedly backed 1:1 with the US dollar or equivalent assets (a very dubious claim), which is meant to avoid the instability normally associated with cryptocurrency.

As a side note, it’s worth noting that Tether has a controversial reputation, even among cryptocurrencies. A new bill introduced in the US to outlaw government use of Chinese crypto networks also took aim at Tether, and WSJ even covered Tether’s black market use in late October, which Tether addressed in a blog post.

According to Gavin Clarkson, Jerry Yu, and BitRush’s lawyer, claims of not paying Crypton Mining Solutions are “baseless and without merit.” Clarkson also claims that the company “complies with all federal, state and local laws and regulations”, despite the seeming heavy use if cryptocurrency to evade attention from the authorities in this matter.

If the claims against Jerry Yu and BitRush are true, contractor payments may soon be the least of that N.Y.U. student’s worries.

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