Kyrgyzstan profits from cryptocurrency mining and will allow it to continue after the cold winter months, the country’s president has promised.
The Central Asian nation unplugged its crypto farms this week amid electricity shortages exacerbated by low water levels in dams used to generate hydroelectric power.
Kyrgyzstan benefits from mining and will restore operations
Mining is a profitable industry for Kyrgyzstan, and its government intends to allow it again, when the cold weather ends next spring, and invite crypto miners, as soon as it has a surplus of energy.
This is according to a new statement by President Sadyr Zhaparov, who commented on the recent shutdown of mining farms in the former Soviet republic.
Its energy minister announced earlier this week that Bishkek is disconnecting all crypto farms from the grid amid a growing power deficit, as reported by Cryptopolitan.
On top of increased energy needs in the winter season, the country is also running low on reservoir water necessary to generate electricity, the official told local media.
The country has two main mining farms – one in the city of Kemin, and the other at the Kambar-Ata 2 hydroelectric power station, Sputnik Kyrgyzstan noted in a report.
The former operates entirely on electricity supplied by Russia and imported through Kazakhstan. It could have been allowed to continue to operate, as it pays transit fees and contributes to the state budget, but Kyrgyz authorities decided to unplug it, nevertheless, to conserve energy.
The second facility was purchasing unused 30 megawatts (MW) from the adjacent power plant. The latter has a nominal capacity of 120 MW, but due to its old transmission lines and transformers only 90 MW are usable. This mining enterprise has committed to upgrading the infrastructure.
Cryptocurrency mining will be suspended until the end of March 2026, when temperatures begin to rise, leading to a decrease in power consumption.
Both crypto farms will resume operations after the winter cold, Zhaparov said in the interview with the Kabar news agency, which was published on Friday.
Kyrgyzstan’s government to welcome miners when it has enough power
The president highlighted that the minting of digital coins is profitable for his nation and emphasized that his administration intends to invite more miners, once its new generating capacities are built.
He also insisted that all decisions in Bishkek are made “in the interests of the people,” after carefully weighing the pros and cons, and that projects that are not beneficial to the state are scrapped.
Zhaparov was referring to the construction of the Kambar-Ata 1 hydroelectric power plant (HHP). He noted that the surplus electricity after its completion, especially in the spring, summer, and fall, will have to be sold to someone.
In his own interview with 24.kg, Kyrgyzstan’s Minister of Energy Taalaibek Ibraev pointed out that the government is working to increase electricity generation by commissioning new HPPs and a 120 MW solar station, expected to be up and running by the end of the year.
Ibraev explained that the main reason for the current restrictions is the need to save energy. He also said that the water level of the Toktogul Dam is much lower than last year. The reservoir feeds water to the country’s largest HPP, the Toktogul Hydroelectric Station.
Kyrgyzstan adopted a law “On Virtual Assets” in September of this year, which regulated Bitcoin mining, along with other crypto-related activities, including by state-owned enterprises.
The problems with the electricity shortages it’s facing during this time of the year are not an isolated phenomenon in the region, where winters are harsh and very cold.
This week, Russia imposed a seasonal ban on mining in two of its regions in Siberia. The extraction of digital currencies has been completely prohibited, year-round, in almost a dozen other regions where miners have been held responsible for overloading the grid.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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