Increase in crypto mining causing power shutdowns in Kazakhstan

What

An increase in demand for electricity by cryptocurrency miners has resulted in power shortages and even shutdowns at three power plants across Kazakhstan.

Why

The rise in popularity of crypto mining is driven partly by the rise in value of the coins alongside an influx of miners to its borders following China’s ban in May.

What next? 

Kazakhstan now plans to charge registered miners in the country and ration electricity to meet the demands.

The Story

The rise in crypto mining activity has caused power shutdowns and blackouts throughout Kazakhstan. 

Lower electricity costs and China’s ban earlier in the year made the largest country in Central Asia a haven for miners, spiking the electricity demand by eight percent. A report by the Financial Times estimates around 87,849 mining rigs have moved from China to Kazakhstan. 

To help curb the demand, KEGOC, the country’s electric grid operator plans to start rationing electricity to 50 registered miners. This is also to deal with unregistered crypto miners illegally mining the digital currency from factories and their homes.

To read more about the process of Bitcoin mining and how it works, visit our learning portal here.

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