The global computing power of the bitcoin network has dropped sharply as the shutdown this week of Kazakhstan’s internet during a deadly uprising hit the country’s fast-growing cryptocurrency mining industry.
Kazakhstan became last year the world’s second-largest centre for bitcoin mining after the United States, according to the Cambridge Centre for Alternative Finance, after major hub China clamped down on crypto mining activity.
Russia sent paratroopers into Kazakhstan on Thursday to help put down the countrywide uprising after violence spread across the tightly controlled former Soviet state. Police said they had killed dozens of rioters in the main city Almaty, while state television said 13 members of the security forces had died.
The internet was on Wednesday shut down across the country in what monitoring site Netblocks called “a nation-scale internet blackout”.
The move would have likely prevented Kazakhstan-based miners from accessing the bitcoin network.
Bitcoin and other cryptocurrenices are created or “mined” by high-powered computers, usually at data centres in different parts of the world, which compete to solve complex mathematical puzzles in a highly energy-intensive process.
In August last year, the most recent data available, Kazakhstan accounted for 18% of the global “hashrate” – crypto lingo for the amount of computing power being used by computers hooked up to the bitcoin network.
In April, before China’s latest clampdown on bitcoin mining, the figure was just 8%.
The hashrate at major crypto mining pools – groups of miners in different locations that team up to produce bitcoin – including AntPool and F2Pool was on Thursday at 1215 GMT down around 14% from its level late on Tuesday, according to data from mining firm BTC.com. Neither pool immediately responded to a Reuters request for comment,
CRACKDOWN ON CRYPTO MINING
Yet a drop in hashrate isn’t necessarily supportive for the price of bitcoin.
Bitcoin fell below $43,000 on Thursday, testing multi-month lows after investor appetite for riskier assets fell as the U.S. Federal Reserve leant toward more aggressive policy action.
The more miners on the network, the greater the amount of computer power is needed to mine new bitcoin. The hashrate falls if miners drop off the network, in theory making it easier for the remaining miners to produce new coin.
Kazakhstan’s crypto mining farms are mostly powered by ageing coal plants which themselves – along with coal mines and whole towns built around them – are a headache for authorities as they seek to decarbonise the economy.
The Kazakh government said last year it planned to crack down first on unregistered “grey” miners who it estimates might be consuming twice as much power as the “white” or officially registered ones.
Its energy ministry said last year “grey” mining may be consuming up to 1.2 GWt of power, which together with “white” miners’ 600 MWt comes up to about 8% of Kazakhstan’s total generation capacity.
The country’s uprising began with protests in the west of the country against a New Year’s Day fuel price hike.
(Reporting by Tom Wilson; Editing by Emelia Sithole-Matarise)
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
