Venezuela bans Bitcoin mining operations
To fulfil the population’s stable electricity demand, the Venezuelan government agencies decided to shut down Bitcoin mining operations in the country.
Venezuela is a good jurisdiction for crypto companies because the Venezuelan population has turned to cryptocurrencies due to its severe economic crisis and hyperinflation. Many Venezuelans use Bitcoin and Ethereum to preserve their wealth as the bolívar loses value. The government also introduced its digital currency, the Petro, but it hasn’t been widely adopted. Cryptocurrencies help Venezuelans conduct transactions and access international markets despite government controls and a failing economy.
On 18 May 2024, Venezuela’s National Association of Cryptocurrencies informed that Bitcoin & crypto mining is now restricted throughout the country.
A local media report confirmed that Venezuela’s Ministry of Electric Power decided to disconnect cryptocurrency mining farms from the national grid. With this decision, they aimed to control high electricity use and ensure a stable power supply for everyone in the country.
It is worth it to know that recently the Aragua state authorities confiscated 2,000 cryptocurrency mining devices, which is about 120 kilometres southwest of Caracas, as part of an anti-corruption effort.
As per media reports, the country has been facing a significant electricity outage since 2019, which impacted the common life of people & economic growth of the country.
Cryptocurrency mining & challenges
Crypto mining is infamous worldwide, as such operations require high electricity consumption. In late 2021, China imposed a blanket ban on cryptocurrencies citing high network pollution because of digital assets mining operations.
In 2022, Kazakhstan introduced highly strict rules & laws for the crypto-mining industry, to maintain stability between the domestic & commercial load on the national electricity grids. They also increased electricity costs for the Bitcoin mining companies, later Bitcoin mining companies signed an open letter to President Kassym-Jomart Tokayev, complaining about the high energy prices for miners.
Read also: Popular Bitcoin hater Schiff says he can’t sacrifice his integrity just to gain followers
