The electricity distribution company Électricité du Laos (EDL) of Laos, a landlocked country in Southeast Asia, recently stated that it’s going to plug out the electricity supply to the crypto mining activities throughout the nation, mentioning multiple reasons like unavailability of the plant to produce sufficient electricity during severe droughts.
Laos Cracks Down on Crypto Miners
As per the disclosure, Laos encountered a drought in the first half of 2023 that resulted in intense heat raising the need for electricity and hence making it difficult for hydropower facilities to produce enough of it.
Miners Unable to Pay Dues
An EDL employee stated in an interview with a regional news source, the Laotian Times, that the second reason for the suspension of supply for cryptocurrency mining operations is that they are unable to “pay their outstanding balances.”
95% of the nation’s energy is produced by hydropower projects, according to the EDL, which intends to export significant amounts of electricity to Thailand in 2024. As the situation worsens, it will also have an impact on the nation’s export capacity.
Laos Followed El Salvador’s Footsteps
Following El Salvador’s adoption of Bitcoin in 2021, Laos granted permission for over 6 enterprises to generate Bitcoin within its borders. The Japan International Cooperation Agency teamed up with the Bank of the Lao People’s Democratic Republic.
According to a February post from The Block, BTC.com showed that the most recent market adjustment has caused Bitcoin’s mining difficulty to increase by 9.95%.
Crash in BTC Price Impacted Crypto Miners
The disappointing performance of the BTC market had a big impact on the amount of money mining generated for industry participants in November of last year. As a result, network complexity and technology demand have increased, and the revenue scale has been steadily declining.
The difficulties that miners face in order to solve valid blocks are anticipated to rise by around 10% in the network’s future changes, according to mining insights from the on-chain statistics site Coinwarz.com.