After several days of shutdown, Bitcoin mining companies in Kazakhstan have restored between 80% and 90% of their production activities, according to Alan Dordjiev, head of the Kazakh National Association of Blockchain and Data Centers.
Despite this resumption of mining activity, Bitcoin’s global hash rate, which fell by more than 10% during the internet blackout in Kazakhstan on January 5, is taking time to recover. Today, it is 17% below its historic high of around 205,000 petahash per second (PH / s).
Mr Dordjiev told BeInCrypto that miners are trying to restore production capacity to 100% quickly. “We estimate that the situation will stabilize completely within a week,” he said in our interview on January 11.
As a reminder, Kazakhstan represents around 18% of Bitcoin mining activity. It is therefore the second country in the world after the United States in terms of crypto mining. However, the Central Asian country has been hit by deadly protests over the past week, sparked by soaring fuel prices.
After the internet was suspended by Kazakh network provider Intelecom during the riots, the hash rate, a measure of global computing power dedicated to Bitcoin mining, fell sharply.
Dordzhev, whose association represents 25 registered miners, or 70% of all miners in the country, and 600 MW of electricity, stressed that the blackout was “temporary”. It has not affected the regions where professional crypto mining companies operate, he added.
Internet services are now operational in most areas, Dordzhev continued. Kazakhstan-based miners like Energix and KZ Systems have also returned to the grid. However, Bitcoin’s total hash power only increased 2.4% to 172,000 PH from around 168,000 PH a few days ago, according to data from YCharts.
Bitcoin mining units could leave Kazakhstan due to civil unrest
Rising hash rate reveals that miners expect to make a profit. Something that could cause the price of BTC to rise. The relationship is not so linear, however, as it is difficult to gauge future price changes based solely on the hash rate.
The upside is that when miners consume more computing power to process Bitcoin transactions, they secure the network against 51% attacks, a situation that could allow malicious miners to hijack the system and spend the same twice. rooms.
“From a strategic point of view, Kazakhstan will remain one of the best destinations for crypto mining activity,” Dordzhev said in a previous statement received by BeInCrypto.
“Currently, there is a constructive dialogue on the regulation of the sector with the relevant state bodies. Previously introduced restrictions on the supply of electricity to “white” miners have been relaxed considerably, ”he said.
For his part, Matrix Exchange CEO Vasja Zupan believes Bitcoin mining activity within the country will struggle to recover. “Due to the tense political situation in the country, I expect more miners to move their operations abroad,” he said.
“This seems all the more likely when one realizes that Kazakhstan was, from the start, a temporary refuge for minors seeking a more stable and predictable environment before the current unrest erupted. . In addition, I also expect that the current drop in price will cause some of the miners to suspend their activities, thereby reducing the hash rate, ”Zupan concluded.
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