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Kazakhstan Shuts Down Banks, Internet Amid Unrest That Threatens Bitcoin Mining, Hashrate

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Kazakhstan Shuts Down Banks, Internet Amid Unrest That Threatens Bitcoin Mining, Hashrate

Measures imposed by authorities to quell mass protests in mining hotspot Kazakhstan are affecting cryptocurrency markets and the Bitcoin network hashrate. To deal with the civil unrest caused by rising fuel prices and a worsening economy, the government restricted access to the internet and closed down local banks. Fears are rising that the turmoil may spark another major migration of miners now that some are already leaving the country, which also faces power shortages.

Government Takes Country Offline as Protests Rage in Major Cities, Russia Sends Troops

Thousands of Kazakhstanis took to the streets this week to express their anger over the socioeconomic conditions in their country after the government removed a cap on prices of natural gas and other fuels. Protests erupted in the country’s largest city, Almaty, the capital Nur-Sultan, and in the western Mangistau province. Authorities have imposed a state of emergency.

Over 1,000 citizens have been injured, official media reported, during the demonstrations in which government offices were attacked, guns fired, and people killed both among protesters and law enforcement officers. On Jan. 5, President Kassym-Jomart Tokayev dismissed the government, blaming ministers for the situation that threatens to spiral out of control. Russia has already sent “peace keeping” troops after Tokaev asked the allied country for help in the face of a “terrorist threat.”

Kazakhstan has been largely offline in the past couple of days, with disruptions affecting phone connections as well. The monitoring group Netblocks revealed on Wednesday that the country is in an internet blackout. On Thursday, the state-run Khabar 24 TV news channel confirmed that access to the world wide web has been restricted with users being unable to reach social media platforms and messaging apps.

Meanwhile, all bank offices across the nation have been closed down, according to a representative of the National Bank of Kazakhstan quoted by the Russian Interfax news agency. The official, Olzhas Ramazanov, explained that the regulator has made the decision after “taking into account temporary internet interruptions as well as to protect the health and life of employees of financial institutions and consumers of financial services.”

Kazakhstan Unrest Hits Crypto Markets, Bitcoin Hashrate

The rapidly developing events in Kazakhstan affected cryptocurrency markets and the price of bitcoin (BTC) fell below the $44K mark on Wednesday when the crypto economy shrank by around 4.5% to $2.25 trillion, as Bitcoin.com News reported. The cryptocurrency with the largest market capitalization is trading under $43,000 per coin at the time of writing on Thursday.

Amid the crackdown on crypto mining launched by the Chinese government in May, Kazakhstan became a magnet for companies involved in the minting of digital currencies, thanks to its capped electricity rates and generally positive attitude towards the industry. The country’s average monthly hashrate share exceeded 18% last year, with the Central Asian country turning into a major mining hotspot.

Starting the new year at almost 229 exahashes per second (EH/s) on Jan. 1, the mean hashrate of the Bitcoin network fell below 170 earlier this week. It currently stands at 167.86 EH/s, at the time of writing. Members of the crypto community have expressed fears that a further deterioration of the situation in Kazakhstan could affect the indicator even more as miners may begin to relocate to jurisdictions with a more stable political environment and power supply.

While Kazakhstan initially welcomed mining companies and has taken steps to regulate the sector, authorities have blamed the country’s growing problems with electricity shortages on the influx of mining companies. The power deficit exceeded 7% in the first three quarters of 2021 and interruptions in energy supply have already forced some businesses to shut down crypto farms and move equipment to other mining destinations such as the U.S.

Do you think the crypto world will witness another major migration of miners in 2022 due to the events in Kazakhstan? Share your expectations in the comments section below.

Uzbekistan Warns Citizens to Avoid Unlicensed Cryptocurrency Exchanges

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Uzbekistan Warns Citizens to Avoid Unlicensed Cryptocurrency Exchanges

A government agency in Uzbekistan has published a list of unauthorized crypto exchanges that residents of the country have been advised to avoid. The trading platforms collect personal data and bear no responsibility for the cryptocurrency transactions, officials have warned.

Authorities in Uzbekistan Blacklist ‘Unofficial’ Crypto Exchanges


The National Agency of Project Management under the President of Uzbekistan has identified a number of online platforms offering crypto trading services without authorization. During a monitoring campaign on the internet, the body registered an increase in activities of such “unofficial” digital asset exchanges.

The entities behind them offer Uzbekistani citizens the option to buy, sell or trade crypto assets without having an office in the country. They are usually registered in other jurisdictions and their servers are located abroad, but at the same time they collect personal information from residents of the Central Asian republic, the agency said in a notice published on its website.

Uzbekistan Warns Citizens to Avoid Unlicensed Cryptocurrency Exchanges

Half a dozen crypto exchange websites targeting residents of Uzbekistan have been blacklisted: webmoneytashkent.com, wmztashkent.com, wm-torg.com, uzwmz.com, blockchainuz.com, and bitcointashkent.com. Similar services are offered through Telegram bots and groups as well. Their providers, the regulator noted, often remain completely anonymous and can quickly delete a channel.

Officials have stressed that these kinds of platforms do not bear any legal responsibility for crypto transactions between various parties and cannot guarantee their legitimacy. Furthermore, they cannot ensure the proper storage of personal data or preservation of confidentiality. The announcement states:

The Agency urges citizens to be as vigilant as possible, beware and not use services of such platforms, including so as not to become victims of fraud.

Uzbekistan legalized crypto trading in 2018 but then in December 2019 authorities in Tashkent effectively banned residents from purchasing cryptocurrencies though they were allowed to sell. The National Agency of Project Management has now reminded the public that in accordance with the presidential decree “On measures to develop the digital economy in the Republic of Uzbekistan” and the country’s law “On licensing and notification procedures,” the establishment of cryptocurrency exchanges is subject to licensing.

The government has tried to encourage certain crypto activities. In January 2020, Tashkent unveiled a plan to set up a national mining pool and the initiative was presented as a priority. The state also said it’s going to establish a licensed cryptocurrency exchange where miners will be able to sell their coins and promised to create a blockchain valley as well as introduce crypto tax exemptions. Uznex, a regulated trading platform operated by the South Korean entity Kobea Group, was launched later that month.

However, in September this year, a high-ranking central bank official was quoted as saying that cryptocurrencies such as bitcoin will never be recognized as legal tender. Speaking to local media, deputy chairman of the Central Bank of the Republic of Uzbekistan (CBU) Behzod Hamraev pointed out that unlike cryptocurrencies, the national fiat, the sum, is backed by the bank’s assets. He also expressed his opinion that bitcoin will never be equal to “world currencies” such as the dollar, euro, yen, and ruble.

What are your thoughts on this story? Tell us in the comments section below.

Bit Mining to Deploy Another 2,500 Bitcoin Miners in Kazakhstan

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Bit Mining to Deploy Another 2,500 Bitcoin Miners in Kazakhstan

Bit Mining is going to expand its operations in Central Asia with the purchase of 2,500 crypto mining machines slated for deployment in Kazakhstan. The new devices are expected to increase the Chinese company’s total hashrate capacity by an estimated 165 petahashes per second.

Bit Mining Buys New Cryptocurrency Miners for Data Centers in Kazakhstan

Shenzhen-based Bit Mining Ltd. announced Wednesday it has secured a purchase agreement for the acquisition of 2,500 new bitcoin mining machines. The price tag of the deal is approximately $6.6 million, the crypto mining firm detailed in a press release.

Following the delivery, which is scheduled for next week, the company intends to ship the coin minting rigs to Kazakhstan. Once deployed, the mining devices are expected to increase Bit Mining’s “theoretical maximum total hash rate capacity by approximately 165 petahashes per second (PH/s).”

Bit Mining said it’s constantly monitoring the market for cryptocurrency mining hardware and will consider “cost-efficient” acquisitions “on an opportunistic basis.” It emphasized:

Looking forward, the company is prepared to further expand the scale of its business and increase its theoretical maximum total hash rate capacity, in order to strengthen its position as a leading cryptocurrency mining enterprise.

Chinese Mining Company Continues Migration to Central Asia

The crypto firm further noted that the expansion of its bitcoin mining machine fleet goes on in parallel with the implementation of its overseas development strategy which is largely focused on Central Asia. Bit Mining has already installed 3,819 rigs with a total hashrate capacity of 172 PH/s in data centers in Kazakhstan. Another 4,033 bitcoin miners with a hashrate capacity of 121 PH/s have been shipped to the country and are currently awaiting deployment.

Bit Mining to Deploy Another 2,500 Bitcoin Miners in Kazakhstan

According to the announcement published by Prnewswire, the company has also launched ethereum (ETH) mining operations outside of mainland China that have a hashrate capacity of 86.4 gigahashes per second (GH/s). “An additional hash rate capacity of 4,713.6 GH/s is expected to be deployed by the end of October 2021,” Bit Mining added.

In May, the Chinese company revealed plans to build and operate a 100 MW crypto-mining data center in Kazakhstan, a project that will be implemented in partnership with two local companies. In June, Bit Mining began moving 3,000 bitcoin mining machines to Kazakhstan amid an ongoing government crackdown on crypto mining in the People’s Republic of China.

Do you expect more crypto mining companies from China to follow Bit Mining’s lead and relocate to Central Asia?

Bitmain to Host Miners in 180-Megawatt Data Center in Kazakhstan

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Bitmain to Host Miners in 180MW Data Center in Kazakhstan

Crypto mining hardware manufacturer Bitmain has partnered with Enegix to host Antminer S19 Pro devices in one of the world’s largest data centers. The facility located in Kazakhstan is designed to accommodate more than 50,000 mining rigs.

Bitmain to Work With Mining Facility Operator Enegix

Leading mining equipment producer Bitmain has announced a partnership with Enegix. As part of the agreement, the ASIC giant will host Antminer S19 Pro miners in a 180MW facility operated by Enegix in Kazakhstan, which is one of the largest in the world.

Enegix focuses its business efforts on designing, building, and operating data centers since 2017, a press release published by Bitmain details. The one in question was commissioned in late 2020 and is the company’s third such facility. Its total capacity exceeds 50,000 current-generation mining rigs.

Commenting on the new project, Bitmain Mining Division Vice President Du Shisheng noted that his company is pleased to have a solid strategic partner in the region and stated:

Enegix is a clear leader in design and operation of large-scale mining facilities. Their success over the years has put them on the map for all major bitcoin miners.

“Enegix is pleased to be able to offer Bitmain the remaining capacity of its 180MW facility. This step from the leading manufacturer of ASIC miners is very important for our company, as it shows trust in our operation,” Enegix CEO Yerbolsyn Sarsenov added. He expressed hopes that the cooperation will be beneficial for both companies and continue into the future.

Enegix to Build More Mining Centers in Kazakhstan

Enegix plans to further expand its activities in Kazakhstan in response to surging demand from cryptocurrency miners. The company wants to develop additional mining infrastructure and is working on design projects for new mining facilities in the Central Asian republic. Enegix is also negotiating agreements for the purchase of electricity to power the crypto farms.

Bitmain to Host Miners in 180MW Data Center in Kazakhstan

Amid an ongoing crackdown, Chinese companies involved in cryptocurrency mining have been migrating to friendlier jurisdictions in the region, most notably Kazakhstan. In May, Shenzhen-based Bit Mining announced it’s planning to build a 100 MW mining data center there, in partnership with two local companies.

According to a study by the University of Cambridge, the country has seen a six-fold increase in its share in global bitcoin extraction in less than two years. It now ranks third in the world by crypto mining volume. However, the government in Nur-Sultan decided to introduce a surcharge for electricity used by mining entities. The local crypto industry expressed concerns the move could turn away potential investors.

Do you think Kazakhstan will remain an attractive destination for cryptocurrency miners? Share your thoughts in the comments section below.

Kazakhstan Introduces Surcharge for Electricity Used by Crypto Miners

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Kazakhstan Introduces Surcharge for Electricity Used by Crypto Miners

Cryptocurrency miners in Kazakhstan will pay more than other consumers for the electricity they use to mint digital coins. The country’s president has signed a law that imposes an additional fee for the power utilized by the energy intensive industry.

Coin Miners in Kazakhstan to Pay Extra Fee per Kilowatt-hour of Electricity

Crypto mining entities in Kazakhstan are going to pay a surcharge for the electrical energy they burn. President Kassym-Jomart Tokayev has signed a new law this week amending the Central Asian republic’s legislation “on taxes and other obligatory payments to the budget.”

The bill, which was voted by the Senate earlier in June, introduces a new fee of 1 Kazakhstani tenge (approx. $0.0023) per kilowatt-hour used by cryptocurrency miners. The new electricity rate will be imposed starting from Jan. 1, 2022, Forklog reported.

Authorities in Nur-Sultan claim the additional charge will “bring out of the shadow” those cryptocurrency miners that currently operate in the gray economy. Albert Rau, the lawmaker named by local media as the author of the bill, said he couldn’t foresee any “critical consequences” from its adoption. Rau insists the parliament has approved a “government version” of the initially proposed amendments.

Crypto Industry Fears New Electricity Rate Will Turn Chinese Miners Away

Representatives of the crypto sector disagree with Rau’s position, warning that the move comes at a very inappropriate moment. Members of Kazakhstan’s National Association of Blockchain and Data Center Industry told the crypto news outlet that the decision “will have a very negative impact on the investment attractiveness of the industry.”

The main concern is that the fee could turn away Chinese companies that have been looking around for other jurisdictions amid the ongoing crackdown on cryptocurrency mining in the People’s Republic. Kazakhstan has been considered among other potential mining destinations, as over the past few years the country has gradually warmed towards the crypto industry.

In May, Shenzhen-based Bit Mining announced it’s planning to build a 100 MW mining data center in Kazakhstan in partnership with two local firms. In June, as Chinese authorities intensified the pressure on bitcoin mining operations, the company started shipping mining devices there. Earlier this month, the Hangzhou-headquartered mining hardware manufacturer Canaan established an after-sales service center in Kazakhstan as more Chinese miners are considering relocation to Central Asia.

What effect do you think the new fee will have on the crypto mining industry in Kazakhstan? Share your thoughts on the subject in the comments section below.