Kyrgyzstan is cracking down on cryptocurrency mining farms that are using power illegally, local media outlet 24.kg reported Saturday, citing a release from the State Committee for National Security of Kyrgyzstan.
Fast facts
- Authorities have spotted over 500 crypto mining farms that were illegally connected to power grids, leading to power shortages, as one set of equipment could consume about 1,500 to 3,000 kilowatts of electricity per hour, the report said.
- Kyrgyzstan is regulating the sector by imposing taxes. According to an October report of the media outlet, a special tax regime was introduced in Kyrgyzstan for entities operating in the field of crypto mining. “The tax base for cryptocurrency mining is the amount charged for electricity consumed during mining, including VAT and sales tax. The tax rate is set at 15%,” the outlet wrote.
- Crypto mining tends to consume a large amount of electricity. China has been phasing out crypto mining operations partially due to the large consumption of power generated by the sector in a bid to reach its carbon neutrality goals.
- Iran has also been cracking down on illegal crypto mining operations, closing down thousands of unauthorized mining facilities, as the nation suffered power outages, according to local media reports.
- Some miners have been flocking to upstate New York, but the New York Senate in June passed a bill to restrict operations using the proof-of-work mechanism, which is energy-intensive.