Kosovo is the latest country to ban crypto mining as it deals with a power crisis
Kosovo, and of course China have issued bans on crypto miningwithin their borders. Iranissued a three-month ban on cryptomining, while Kosovo has banned mining indefinitely.
- Crypto mining consumes more electricity in a year than the annual consumption of a country like Finland.
AdvertisementIn yet another sign that regulators worldwide are concerned about the energy concerns around crypto mining, several countries have started banning Bitcoin mining to save energy for other purposes.
Earlier this month, Artane Rizvanolli, the Economy Minister of the Balkan state of Kosovo, informed the public that the state was banning crypto mining to deal with a global energy crisis. In December 2021, Kosovo was forced to shut down its largest thermal power plant following technical issues, forcing the government to import electricity from overseas.
The government also announced a 60-day state of emergency to deal with Europe’s ongoing energy crisis. The continent itself has been facing surging electricity prices for some months now, stemming from a shortage of natural gas. And amid such a shortage, industries like crypto mining will be the first to fall prey.
Kosovo is not the only country to ban crypto mining
For instance, Kosovo isn’t the only sovereign nation looking to crack down on the industry. The Islamic Republic of Iran, located in Western Asia, placed a three-month ban on crypto mining earlier this month. That ban is supposed to end on March 6, 2022, and while the ban is on authorised crypto miners, the country’s authorities will also be taking down illegal mining farms that consume over 600 megawatts of electricity.
Besides Iran and Kosovo, pressure on power grids is nudging Kazakhstan towards nuclear power as the country banks on crypto mining to boost its economy. China, of course, set things in motion early last year by shunning Bitcoin miners, which is what prompted many of the largest miners in the world to move to Europe, parts of the US, and more.
Bitcoin’s energy concerns
While the mining of Bitcoin and other cryptocurrencies may not have caused the world’s energy crisis, and an outright ban is not an immediate solution, it could become a casualty of these issues.
The massive amounts of electricity that Bitcoin consumes have been cited as a concern more than once. Bitcoin mining is done using data centre-like operations with racks of computers that consume tons of energy every minute.
According to the Cambridge Bitcoin Electricity Consumption Index, a continuous estimation of the total electricity used for Bitcoin mining worldwide, 135.11 terawatt-hour of electricity per year right now, which is more than the annual energy consumption of a country like Finland.
AdvertisementThe numbers are so high that even miners are aware of the possible concerns. According to a July 2021 report by the Bitcoin Mining Council, an open forum of Bitcoin miners, the use of sustainable energy more than doubled during the quarter ended June 2021. The report noted that while about 36.8% of the total energy consumed for Bitcoin mining in 2020 came from sustainable power, the number rose to around 56% in the June quarter last year.
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