Russia is providing Kazakhstan’s cryptocurrency miners with electricity
In an addendum to the collaboration between the two countries, Russia intends to increase Kazakhstan’s energy needs in order to supply power to the former Soviet republic’s miners.
The move is in response to a rise in the demand for power among cryptocurrency miners in Kazakhstan, as mining operations increase.
Russian media outlet RBC found the development in a recent investigation. According to the article, the Russian government has sought changes to the bilateral energy agreements between the two neighbouring nations. This development is in accordance with the Russian government’s directive on the issue.
The amendment intends to secure the simultaneous functioning of the energy networks of both nations. As a result of the newly implemented adjustment, Russia will provide Kazakhstan with adequate electricity for its cryptocurrency mining activities.
Russia intends to ease this transition via Inter RAO, one of its major energy holding firms. Inter RAO is significant in this transaction since it is Russia’s only import-export contractor for energy.
Inter RAO of Russia has signed a commercial deal with Kazakhstan Electricity Grid Operating Company (KEGOC). The arrangement will guarantee Kazakhstan’s energy supply on a purchase-and-sale basis between both parties and beyond.
Following China’s crackdown on cryptocurrency mining activities inside its borders, mining organizations have fled the East Asian nation. Several mining enterprises flocked to Kazakhstan in search of a more favourable environment.
Despite this, Kazakhstan is not devoid of problems. The nation in Central Asia has experienced its fair share of energy degradation problems. Kazakhstan’s worsening energy situation demonstrates the relevance of the Russian alliance.
In January, as a result of an energy crisis in Kazakhstan, the national energy firm disconnected over 200 bitcoin mining operations from the country’s power grid. Although this outage was short, it exposed the precarious state of the nation’s energy industry.
Despite this ominous sign, the majority of crypto mining companies have stayed in Kazakhstan, thanks in part to the country’s recent lenient stance toward these enterprises. As Kazakhstan attempts to handle its energy predicament, the nation may alter its approach to regulating mining companies.
Kazakhstan introduced its first cryptocurrency mining legislation draught last week to regulate the sector. The Majilis, the lowest house of parliament of Kazakhstan, introduced a measure in this respect.