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Bitcoin hash rate has reached a new all-time high, but someone was like: Wait, I thought we were panicking on Monday because of Kazakhstan and stuff?
For clarity, Kazakhstan, a Central Asian country and former Soviet republic, extends from the Caspian Sea in the west to the Altai Mountains at its eastern border with China and Russia.
A noteworthy news: “As Kazakhstan Descends into Chaos, Crypto Miners Are at a Loss.”
So, what is the chaos? Last week, chaos caught up with Kazakhstan due to protests in the south of the country about the spike in fuel prices, which led to police repression.
Also, the removal of former president Nursultan Nazarbayev from his role as head of the security council, and an internet shutdown added the next reason to the chos.
Russian-led troops acting under the orders of the CSTO, which is a military alliance of post-Soviet states, were deployed to the country.
Thus, the shutdown’s impact on crypto mining was evident— and the Bitcoin network lost 12 percent of its hash rate.
So, it is good to see the hash rate to have recovered. Reportedly, Kazakhstan used to be the top three of global crypto mining powers.
For several miners this adds to the already unfortunate circumstances they have been facing for months. Several miners previously planned to relocate to Kazakhastan due to low energy prices: however, the aging power grid was enough to handle the sudden influx of miners, which eventually led to a spike in the consumption of energy. Thus, miners are going through some touch times.
The government pointed to how mining accounted for 8 percent of the country’s capacity. Due to blackouts and power cuts, in October 2021 the government decided to ration power supply to registered miners and also decided that they will unplug the miners if the grid came under any stress.
Thus, at best, cryptocurrency mining farms stop working during peak hours, when the general population would turn on their heating due to the inclement winter. Thus, power providers cut the power to the mining farms from 6 pm to 11 pm. This is definitely a problem for the miners.
There are other countries with cryptocurrency mining infrastructure like Russia, Canada, and the US and they are as well grappling with an acute shortage of adequate facilities.
These trends are not likely to continue. Things will change. Anyone who knows the importance of hash rate will like to see the hash rate for Bitcoin mining is improving.
