Political turmoil in Kazakhstan hits bitcoin mining industry: Crypto Moves

RIYADH: Bitcoin, the leading international cryptocurrency, traded lower on Sunday, falling 0.18 percent to $ 41,620 at 5:12 p.m. Riyadh time.

Ether, the second most traded cryptocurrency, was priced at $ 3,098, down 3.24 percent, according to data from Coindesk.

In other news:

Political turmoil in Kazakhstan is affecting the Bitcoin mining industry after the internet and communications were cut off.

The internet and telecommunications were cut off across the country, which is having an impact on local cryptocurrency mining operations, which are among the largest in the world.

Kazakhstan emerged as a popular mining hub last year after China cracked down on the activity to protect the country’s efforts to cut carbon emissions.

Mining requires high-powered computers to solve complex math puzzles to create a new block on the blockchain, consuming a lot of electricity in the process.

Kazakhstan, with its rich energy resources, has become an attractive alternative to China for miners.

The former accounted for more than 18 percent of the global Bitcoin network’s hashrate in August last year, the latest month for which data was available, according to the Cambridge Center for Alternative Finance.

Hashrate refers to the total computational power that is used to mine cryptocurrencies, according to CoinDesk.

It is unclear when internet services will be restored in Kazakhstan, making it difficult to know how deep the impact of crypto miners will be.

Connectivity had been shut down for 36 hours as of Friday morning, according to internet monitor Netblocks.

Just hours after the internet blackout, the hashrate saw a 12 percent drop, tweeted Larry Cermak, vice president of research at crypto website The Block.

Kazakhstan is struggling to cope with the huge demands on its energy network due to increased cryptocurrency mining, the Financial Times reported.

The power shortage in November also led to the closure of a large crypto mining farm.

Fraud

The Federal Investigation Agency of Pakistan (FIA) has uncovered a cryptocurrency investment scam that allegedly cost Pakistani citizens around 17.7 billion rupees (about $ 100 million).

The country’s top law enforcement agency has also issued a notice to crypto exchange Binance regarding the scam, media reports revealed, Bitcoin.com reported.

Providing details about the case, Imran Riaz, director of the FIA’s cybercrime wing, said on Friday that the organizers used cryptocurrencies.

“We launched an investigation after receiving complaints about a fraud involving billions of rupees that were committed using nine online applications,” Riaz said.

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