In a post on X, the National Association of Cryptocurrencies of Venezuela announced that the country has banned crypto mining to protect the power grid.
Due to its high electricity requirements, the Venezuelan government has joined the list of nations that disapprove of cryptocurrency mining.
The Ministry of Electric Power in Venezuela has revealed plans to cut off cryptocurrency mining farms from the national grid, according to a local news source. The goal of the action is to control excessive energy use and ensure that the public has a steady supply of electricity.
The National Association of Cryptocurrencies of Venezuela said in an X post that mining cryptocurrencies are forbidden in the country.
This action comes after a recent crackdown in which 2,000 Bitcoin mining devices were seized in Maracay as part of a campaign against corruption.
The ministry underlined the necessity of relieving the burden these energy-intensive farms create to provide effective and dependable electrical service throughout Venezuela. Officials claim that these actions are necessary to stabilize the country’s electricity supply, which has been unstable for the previous ten years.
Blackouts have been happening frequently in the nation, especially since 2019. These have had a big influence on people’s everyday lives and the nation’s economy as a whole.
Mining cryptocurrency requires a lot of electricity. As a result, some nations, including China and Kazakhstan, have enacted strict laws or outright prohibited the practice.
The government of Venezuela has taken action against cryptocurrency mining as part of a bigger campaign against corruption that has resulted in the arrest of multiple high-ranking officials. One of the main players in the corruption accusations is Joselit Ramírez, the former director of the National Superintendency of Cryptoassets.
The governor of the state of Carabobo, Rafael Lacava, is said to have emphasized the value of community cooperation in identifying illicit mining operations and urged residents to report any illegal activity.
But this is not Venezuela’s first action to suppress cryptocurrency mining. Venezuela’s energy supplier closed down cryptocurrency mining operations across the nation in March 2023 as a result of corruption investigations involving the national oil corporation.
At the time, Tarek William Saab, Venezuela’s attorney general, claimed that the national crypto department was helping government officials conduct parallel oil activities.
Eight significant cryptocurrency mining companies in Kazakhstan complained about exorbitant energy costs for miners in an open letter to President Kassym-Jomart Tokayev in 2023.
Recently, GreatGameIndia reported that Argentina’s YPF Luz is collaborating with Genesis Digital Assets to mine Bitcoin using natural gas from oil fields, turning stranded energy into a resource.