The local utility has announced power cuts for miners in Kazakhstan. As a result, Crypto farms will remain unplugged until February 7. According to the company, the main reason for the measure, which was supposed to expire at the end of January, is ongoing problems with electricity supply.
Kazakhstan’s Mining Facilities are Still Closed
After Kazakhstan’s power distribution company extended previously imposed supply restrictions for another week, data centres authorized to mint digital currencies will not be able to operate until at least following Monday, February 7.
In a notice obtained by Forklog, the state-run Kazakhstan Electricity Grid Operating Company (KEGOC) informed mining companies of the ongoing restrictions. In addition, the utility cites unresolved issues with maintaining a steady supply of electricity.
The measure was first implemented on January 24, when mining farms were forced to close until January 31. The power outages caused by winter shortages impacted nearly 70 businesses. In addition, Southern Kazakhstan and neighbouring countries experienced blackouts due to a damaged power line.
The head of Kazakhstan’s National Association of Blockchain and Data Center Industry, Alan Dorjiyev, told the crypto news outlet that mining companies are waiting for clarification from the Ministry of Energy before planning their future operations. Hundreds of mining companies are affiliated with his organization.
Kazakhstan has been dealing with a growing power deficit since last year when it became a significant mining hotspot due to China’s anti-mining crackdown. The electricity shortages have been blamed on the influx of miners, who increased the country’s share of the global bitcoin hash rate to over 18%.
Miners have become an excuse for KEGOC and the Energy Ministry, according to Dorjiyev, who stated in January that the problems are caused by ageing infrastructure and insufficient generation capacity. Kazakhstan’s electricity rates are capped, and a lack of investment has hampered the sector.
In Kazakhstan, rising energy prices, particularly for fuels like natural gas, sparked mass protests in the first days of the year. To stop the unrest, the government shut down banks and restricted internet access. The turmoil impacted the crypto mining industry, but miners resumed operations until recent power outages hit them as the situation stabilized.