The Energy Department has estimated that demand for electricity has jumped eight percent so far in 2021, compared to a more typical one or two percent. There have been blackouts in six regions since October.
Officials and observers attributed the power cuts to the growing number of unregistered crypto miners illegally generating currency from their homes or even factories. China’s war on cryptocurrency could be partly to blame. Demand for energy started to climb when mining companies left China in early 2021, and it jumped again when China made mining illegal in May. Electricity has been relatively cheap in Kazakhstan, making it a haven for companies hoping to reap larger profits from crypto operations.
Kazakhstan is trying to compensate for power shortages. It is asking a Russian energy company to supplement the national electricity grid, and it will charge registered miners a compensation fee of 1 tenge (about $ 0.0023) for each kilowatt hour from 2022. Both efforts will take time, however. , and this forces minors to shrink or move the equipment.
There are also concerns that the government is not being honest about its problems. Luca Anceshi from the University of Glasgow supported The temperature that Kazakhstan was the scapegoat for miners for the reliability problems of the country’s electricity grid. Whether this is true or not, it is safe to say that mining demand hints at potential problems for other countries if their local crypto production takes off.
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