Kosovo’s government banned crypto mining on Tuesday in an effort to reduce electricity usage as the country is facing the very worst energy shortage in a decade due to the manufacturing blackouts.
All law enforcement agencies will halt this action in collaboration with some other competent authorities that will recognize the places where crypto production occurs.
Because of low electricity prices in Kosovo in recent times, numerous young people in the country have become engaged in crypto mining for currencies such as bitcoin.
Mining for Bitcoin (BTC) has always been a burning topic in recent weeks, at least, with the effect of extraction on global warming at the heart of the debate.
Bitcoin is estimated to cover 707KwH for every transaction, as per a report from the Columbia Climate School. Furthermore, mining computer systems add to the usage estimate due to cooling load. According to the University of Cambridge, Bitcoin mining uses up to 121.36 terawatt-hours each year.
Officials were required to undertake power cuts steadily for the past month due to coal-fired power plant power failures and rising import costs.
European gas prices increased by more than 30 percent on Tuesday, as limited supplies from Russia fueled fears of an energy shortage as colder temps approached.
Kosovo raised the alarm for sixty days in December, allowing the government to spend lots of money on imported energy, implement more power outages, and impose stricter provisions. One miner, who asked to remain anonymous and owns 40 GPUs, told Reuters that he spends about 170 euros a month on electricity & earns about 2,400 euros a month from mining.
Coin mining has increased in northern Kosovo, which is primarily inhabited by Serbs who don’t even acknowledge the state of Kosovo as well as keep refusing to pay for the electricity.
The 1.8 million-person country nowadays is importing over 40 percent of its consumed energy, with growing market demand during the cold season, when folks utilize electricity primarily for heat generation.
Approximately 90 percent of Kosovo’s power production is derived from lignite, delicate coal that emits toxic pollutants when burned.
According to official numbers, Kosovo does have the world’s 5th largest lignite reserves, with 12-14B tonnes.
However, Kosovo would not be the first country to face an energy crisis of this magnitude. Iran, in a similar action, banned cryptocurrency mining inside its own borders on 28th December. However, Iran’s prohibition has a deadline, giving residents until March 6th to conserve energy and minimize power outages throughout the winter.
Meanwhile, the native report stated that law enforcement agencies are preparing to assist in ensuring that the extraction ban is rigorously enforced. They will further strive to identify laborers who violated the new legislation.
The Kosovo govt’s latest effort brings Bitcoin mining as well as climate change back into the limelight.
The Chinese government’s restriction on Bitcoin mining was not simply to line up with the government’s approach to cryptocurrencies. The Chinese government intends to achieve carbon neutrality by 2060. Bitcoin extraction is approximated to emit 22 to 22.9 million metric tonnes of CO2 per year. There are fears that this figure will continue rising. Renewables are prohibitively expensive, and it would eat into mining profits.