Former gov’t official blames crypto mining for energy crisis in Kyrgyzstan

One of the core problems associated with cryptocurrencies, especially Bitcoin, is energy consumption. Mining is a huge energy hog, and this is largely due to the fact that the algorithm for mining is designed to be as difficult as possible. As a result, miners have to use a lot of processing power to solve the mathematical puzzles involved in mining new coins. In fact, Bitcoin, Litecoin, and other cryptocurrencies have been blamed for consuming up to 0.5% of the world’s energy. This is a problem that needs to be addressed, because people around the world are starting to notice the huge amounts of electricity being used to mine cryptocurrencies.

This week, a former energy minister in Kyrgyzstan informed media that the country’s energy crisis has been brought on and exacerbated by the region’s crypto mining operations. He described the situation as a “nightmare” that could change the country’s political structure, as the government attempts to pay back a $500 million debt to the power company. ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~  ~

As concerns grow over Kyrgyzstan’s energy sector, a former government official says cryptocurrency mining is one of the main factors behind the energy crisis.

Daniyar Akmatov, former head of the national investment protection agency, the Investment Promotion and Protection Agency, addressed the problems of the Kyrgyz energy sector at a roundtable in Bishkek, local news agency Tazabek reported Wednesday.

The former official said that cryptomining, along with other factors such as the devaluation of the Kyrgyz som and poor promotion of energy investments, are causing problems in the country’s energy sector.

Electricity consumption related to cryptocurrency mining has increased, leading to an energy crisis, Akmatov said, adding: The Som depreciates due to the rising dollar rate, and Kyrgyzstan is an import-dependent country, which also affects tariffs.

Kyrgyzstan’s President Sadyr Japarov recently proposed raising electricity tariffs for households to address energy shortages. According to Dzhaparov, local energy companies are indebted to the tune of 129 billion Som ($1.5 billion) and he says the country’s main energy infrastructure has been outdated for years due to corruption by senior officials.

Kyrgyzstan is trying to regulate cryptocurrency mining activities in the country, but has yet to set specific rules.

Other countries have also blamed bitcoin mining (BTC) for energy shortages. Abkhazia is facing an electricity shortage, presumably due to the 625 cryptocurrency mining farms in the small country.

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