Because of the civil turmoil in Kazakhstan, Bitcoin is experiencing some price fluctuation in the current market condition. Following months of protests in the Central Asian country, the president announced an internet blackout, which has resulted in a 12% decline in the Bitcoin network’s hashrate.
Kazakhstan is renowned for being the second-largest contributor to the Bitcoin network’s hashrate only after the United States. The Central Asian country, which is China’s neighbour, controls up to 18% of the Bitcoin hashrate, ahead of Russia. Larry Cemak, VP of research at The Block Crypto, brought into notice the reduction in Bitcoin’s hashrate.
So, what’s going on in Kazakhstan?
The country is experiencing an energy crisis, which has resulted in protests. Thousands of demonstrators reportedly flooded the streets after the administration declared a double-digit jump in the price of liquefied petroleum gas (LPG). Because Kazakhstan is a petroleum exporter, many Kazakhs find the government’s actions unreasonable.
Prior to the fuel price protests, the country was already attempting to limit the energy usage of Bitcoin miners in the country due to power disruptions caused by increasing domestic energy demand throughout the winter. The country’s electrical grid operator, KEGOC, announced in November that it will begin restricting electricity for registered miners following that. If there are grid breakdowns, they will be the first to be disconnected, according to the quasi-public company.
Similarly, the government agency has been chasing unregistered Bitcoin miners in order to bring them into compliance with the country’s miner registration laws. It enacted the legislation as a method to rein in the mining industry after it experienced explosive expansion last year as miners flocked to Kazakhstan from China. The president of the country recently said that he does not see any benefit in crypto mining for the country.
The price of Bitcoin (BTC) has plunged to a three-month low! The world’s largest cryptocurrency, with a market cap of $820 billion, is down 6.21% at $43,452. Bitcoin’s latest price drop has wiped out almost $65 billion in investor equity.