Amid Bitcoin mining shut down in China, Kazakhstan became the ‘new China’ for Bitcoin mining. The biggest miners of the world also diverted their attention towards this landlocked country for installing their Bitcoin mining farms there. Resultantly, in a very short time, Kazakhstan became the second biggest country hosting the biggest Bitcoin mining farms in the world.
Initially, the Government of Kazakhstan was proved itself to be crypto-friendly but the situation has now been changed.
While Kazakhstan is currently been seen as the ‘new China’ yet it lacks various sources. Energy is one such source that is evidently lacking in Kazakhstan while mainland China is self-sufficient in terms of energy.
Currently, Bitcoin’s hashrate, which is crucial for processing further Bitcoins, has been reduced by 13.4%. This is a massive reduction which has been caused because there is no internet in the country since yesterday. Resultantly, Bitcoin’s petahash rate of 205,000 has been drastically reduced by 177,330 pentahash per second. Before the shutting down of the internet in the country, Kazakhstan was providing 18% of the global processing power in hashrate to Bitcoin.
It seems that nothing is going in favor of Bitcoin after the commencement of 2022. Firstly, the prices are going down consistently and Bitcoin has been struggling in settling at any crucial price ranges. The only good thing for Bitcoin was its processing power which remained top-notch throughout the year 2021 and even in 2022. It was thought that even if prices continued to decline but the reduction will not happen to its hashpower. However, this assumption too has fallen to the ground and the processing power has reduced instantly by more than 13%. The situation will further deteriorate if internet connectivity is not restored in Kazakhstan immediately. Every single day will further reduce the hashpower by at least 3% each time.
The reason behind the suspension of the internet in the country is of political nature. The Government decided to increase prices on petroleum and petroleum goods. The Cabinet however resigned in protests of price increase but before their resignation, internet company Kazakhtelecom disconnected the network. The political situation hasn’t changed a little bit in the country but it is hoped that the internet will be restored in due course.
