The exodus from China of Bitcoin miners to Kazakhstan has led to an energy crisis that the president of Kazakhstan, a central Asian country, has suggested solving using nuclear energy.
The Ministry of Energy in Kazakhstan has said that Bitcoin miners are responsible for the 8% increase of Kazakhstan’s electricity consumption over 2021. According to the Financial Times, this country has received at most 87,849 Bitcoin mining devices from Chinese companies since China’s crackdown on cryptocurrency mining.
According to the Kazakhstan Electricity Grid Operating Company, the substantial rise in demand has caused a shortage in domestic power supply and led to unreliable electricity services. At a meeting on Nov. 19, President Tokayev stated to bankers that he believes building a nuclear power station will ease the strain on Kazakhstan’s electrical infrastructure.
“We will need to take a difficult decision regarding the construction of a nuclear power station, looking into the future.”
Tokayev didn’t connect the proposal with Bitcoin mining power usage, but failing to keep miners in country could threaten the $1.58 billion in tax revenues that they represent. Xive, a Bitcoin mining marketplace, has already been forced to close its doors in Kazakhstan due to power shortages. Didar Bekbau is the co-founder and CEO of Xive. He stated in a Nov. 25 Tweet that he had to close down his mining farm because of “restricted electricity supply” from the grid.
It was a difficult decision to close down the mining farm in south KZ. The last container is available for shipment. People, work and hopes are destroyed. Country risk played out pic.twitter.com/J8ZMg6GeUI
— Didar (@didar_bekbau) November 24, 2021
There are now 50 crypto mining companies registered in Kazakhstan and an unknown number unregistered.
Related: President Tokayev of Kazakhstan says that despite being the second largest crypto miner worldwide, there is virtually no return on our investment.
In a country that has suffered from severe nuclear fallout during Soviet occupation, the decision to build nuclear power plants is serious. In 1999, Kazakhstan closed its last nuclear power station.
Currently, 88% of Kazakhstan’s power comes from fossil fuel-burning power stations.