In the face of power shortages, Kazakhstan's president has called for 'urgent' regulation of cryptocurrency mining.
Kazakhstan is trying to avoid an energy crisis this winter, owing to an electrical deficit largely blamed on cryptocurrency miners.
The country's president has emphasised the importance of maintaining electricity supplies for industry and the general public, calling for immediate legal oversight of the rapidly growing coin minting industry.
President Tokaev calls for legislation in Kazakhstan to regulate cryptocurrency mining
President Kassym-Jomart Tokayev recently chastised Kazakhstan's energy minister, Magzum Mirzagaliev, for allowing a dramatic fall in fuel reserves during a meeting with him. The head of state also underlined the importance of ensuring a continuous supply of electricity for both enterprises and homes, as well as expanding producing capacity.
According to a news statement from Tokayev's office, Mirzagaliev told the president about measures made to compensate for fuel shortages and offered a forecast for Kazakhstan's power generation industry's development through 2035. Electricity consumption is expected to rise annually, and Kazakhstan plans to meet this need by relying on renewable energy, natural gas, and hydroelectric power.
Despite China's escalating crackdown on bitcoin mining, the Central Asian nation, which maintains low electricity costs, is becoming home to an increasing number of cryptocurrency miners. Their energy-guzzling data centres have been blamed for a 7% increase in usage in the first nine months of this year alone, with officials claiming that a single mining farm consumes as much electricity as 24,000 homes.
Minister Mirzagaliev also briefed Tokayev on measures aimed at tightening supervision over the cryptocurrency mining industry, particularly with relation to unlawful coin minting. According to official estimates, these so-called "grey" miners consume up to 1,200 megawatts of electricity. Authorities are continuing to look for such facilities across the country.
The president directed the administration to scale up these efforts with the assistance of other appropriate authorities, according to the declaration cited by Forklog. Tokayev also charged the executive branch with organising "immediate legislative mining legislation."
Simultaneously, he emphasised that lawful, "white" miners will be able to continue their operations without more limitations. Kazakhstan, he believes, has the resources to assure a steady supply of electricity for its home market.
Tokayev's remarks come after a group of MPs urged last month that a state register be established for cryptocurrency farms operating in the country. Mazhilis members also proposed that miners be charged a higher price for the electricity they consume.
One of Kazakhstan's major problems is the capped tariff, according to officials in Russia's neighbour as a result of the artificially low price, new infrastructure and generation capacity investments have been curtailed. Inter RAO, a Russian energy conglomerate, recently said that it is considering supplying electricity to Kazakhstan to help the country deal with winter power shortages.