The departure of Bitcoin miners from China to Kazakhstan contributed to the energy crisis, which the leader of this Central Asian country proposed to solve using nuclear power.
Kazakhstan’s Ministry of Energy explained the 8% increase in domestic electricity consumption in 2021 due to bitcoin miners. According to the Financial Times, the country received at least 87,849 bitcoin miners from Chinese companies this year after China began suppressing crypto mining.
According to the Corporation of Electricity Grid Operators of Kazakhstan, the increase in demand has led to a lack of power supply in the domestic market and contributed to an unreliable power supply. President Tokayev told bankers at a meeting on November 19 that the construction of a nuclear power plant in his opinion would help reduce the load on the country’s electrical infrastructure:
“Looking to the future, we have to make the unpopular decision to build a nuclear power plant.”
Although Tokayev has not linked its proposal to use bitcoin mining power, not retaining miners in the country could jeopardize the estimated $ 1.58 billion in tax revenue that these miners represent. Power outages have already forced the Xive bitcoin mining market to leave Kazakhstan. Xive co-founder Deidar Bikbau said on November 25 on Twitter that he had to close the company’s mining farm due to “restrictions on the supply of electricity from the grid”.
There are currently 50 registered digital mining companies in Kazakhstan and an unknown number of unregistered companies.
On the subject: President of Kazakhstan Tokayev said: “We are the second cryptocurrency miner in the world and we see virtually no economic return.”
The decision to build new nuclear power plants is serious for the country, which suffered from the serious nuclear consequences of weapons tests during the Soviet occupation. The last nuclear power plant in Kazakhstan was closed in 1999.
About 88% of Kazakhstan’s energy is currently generated by fossil fuels.