Kazakhstan plans nuclear power plant to keep crypto mining going

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Kazakhstan’s President Kassym-Jomart Tokayev has offered to build a nuclear power plant to support the growth of the country’s cryptocurrency mining amid the energy crisis facing the country.

The suggestion was made at a meeting with bankers on November 19, following various proposals that seek to “increase the contribution of the national financial system to economic development and the well-being of citizens.”

After China’s crackdown on crypto mining, Kazakhstan has become a popular migration spot for Chinese miners. The lack of government intervention in crypto mining and low energy costs have made the country a promising fate.

Kazakhstan is said to be in second place in global control of Bitcoin’s mining power, after the United States, posting an 18.1% share of the global hash rate according to IP data from the Cambridge Center for Alternative Finance index . This implies a growing demand for which the country’s energy supply was not ready.

Tokayev admitted that the country “is already feeling the first signs of power shortage in Kazakhstan”, considering it to be the result of the rapid growth in crypto mining operations. Energy consumption has grown at an unprecedented rate, reporting an 8% growth (1,000 to 1,200 megawatts) in 2021, while the steady growth in consumption was between 1% and 2% per year. year.

The president now speaks of the need to make “an unpopular decision”, as previous mentions of the building of a nuclear power plant drew huge reactions and criticism in 2019, but he now says “the role of a leader is to make unpopular decisions “.

I think in the end we will finally come to such a decision. We are already feeling the first signs of an electricity shortage in Kazakhstan. Of course, there is no total deficit. The balance is almost zero. But the first signs are indicated. Therefore, looking to the future, we will have to make inherently unpopular decisions regarding the construction of a nuclear power plant.

Related reading | BIT Mining chooses Kazakhstan as new mining base

Will Russia Help Power Plant Project

This is not the first time that Tokayev has offered to build a nuclear power plant. In 2019, he had a chat with Russian President Vladimir Putin, who offered technology and training assistance.

This proposal has not been well received by Kazakh citizens, who fear the environmental implications, costs, energy dependence on Russia and the country’s past as a testing ground for atomic weapons. Soviet.

The reaction from citizens has been strong enough to reject the idea, until now. Tokayev suggests that this is something they need to do and that there is no other way around it. The energy situation is not even worse, but the Energy Ministry has announced that the country will buy Russian electricity for the winter.

In 2019, the president declared that “the decision to build the nuclear power plant will not be taken without taking into account the opinion of the majority of the population of our country”. Now some wonder if his perspective on this has changed.

Tokayev wants to see return on crypto production

In addition, the President of Kazakhstan said it was also necessary to “soberly assess the risks and the potential for their impact on the current financial system” of cryptocurrencies, and called for a balanced regulatory environment that allows for create the country’s own crypto exchanges.

He noted that they see virtually “no financial return” from crypto production and aim for Kazakhstan to benefit from new innovations.

We have to assume that we are only at the beginning of the path of creating an innovative new economy, a financial ecosystem. There is some very serious work ahead. For me, as Head of State, the transfer of our entire economy to new rails of innovative development is a priority task.

Related reading | Kazakhstan Senate approves legislation to monitor crypto service providers

Total Crypto Market Cap at $ 2.6 Trillion in Daily Chart | Source: TradingView


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