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Bitcoin hashrates affected by internet shutdown in Kazakhstan

Updated: Aug 31, 2024
Published: Jan 5, 2022
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The Kazakh government has shut down internet access amid escalating protests. This has severely affected the hashrates of the Bitcoin mining pool.

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Bitcoin hashrates have dropped by 12%

According to a tweet comparing mining pool hashrates from half a day ago, Bitcoin hashrates have dropped by 12% due to the internet shutdown in Kazakhstan. The most affected are 1THash (82% decrease), OKExPool (46.3% decrease) and KuCoinPool (22.7% decrease). According to estimates by the Cambridge Center for Alternative Finance, the situation is remarkable considering that Kazakhstan is home to up to 18% of the world's Bitcoin hashrate.

Kazakhstan experienced recurring power outages during the winter months, prompting national grid operator KEGOC to ration electricity to mining facilities during peak hours. Over the weekend, the unstable power grid combined with pandemic inflation and rising fuel prices led to protests in Almaty, Kazakhstan's largest city. The Kazakh government has begun restricting Internet connectivity in response to the unrest.

Will miners move to the U.S?

The impact of this measure on the hashrate is not nearly comparable to the much more significant drop seen last year when China banned the country's Bitcoin mining ecosystem. At the time, China accounted for more than 50 percent of Bitcoin mining. If Kazakhstan takes similar measures to China, it could see an exodus similar to China's crypto crackdowns last summer.

While Bitcoin miners worldwide are in trouble, the U.S. share of global cryptocurrency production is on the rise. After overtaking China last October, the U.S. is now home to 35.4% of all active Bitcoin mining machines. With countries like Kazakhstan and Iran currently struggling, more miners may be moving to the U.S.

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