JAKARTA – The exodus of Bitcoin miners from China to Kazakhstan has contributed to the energy crisis that led President Kassym-Jomart Tokayev to propose that it be solved by nuclear energy.
The Ministry of Energy of Kazakhstan has attributed an 8% increase in domestic electricity consumption throughout 2021 to Bitcoin miners. According to data from the Financial Times, Kazakhstan received at least 87,849 Bitcoin mining machines from Chinese companies so far this year, following China's crackdown on crypto mining.
The substantial increase in demand has led to a deficit in domestic electricity supply and contributed to unreliable electricity services, according to the Kazakhstan Electric Grid Operations Company.
President Tokayev told bankers at a Nov. 19 meeting that he thought building a nuclear power plant would help ease pressure on his country's electricity infrastructure.
“Looking to the future, we have to make an unpopular decision about building a nuclear power plant,” Kassym-Jomart Tokayev said, as quoted by Cointelegraph.
While Tokayev did not link the proposal to the use of Bitcoin mining power, failure to keep miners in the country could jeopardize the estimated $1.58 billion in tax revenue represented by those miners.
A power shortage has forced the Xive Bitcoin mining market to leave Kazakhstan. Didar Bekbau, co-founder of Xive, said in a Nov. 25 tweet that he had to close his company's mines due to "limited electricity supply from the grid."
Kazakhstan is now home to 50 registered crypto mining companies and the number of unlisted ones is not even known to this day.
The decision to build a new nuclear power plant is a serious one in a country that suffered severe nuclear impacts from weapons testing during the Soviet occupation. Kazakhstan's last nuclear power plant closed in 1999. About 88% of Kazakhstan's current electricity comes from fossil fuel power plants.
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