Crypto mining rig maker Canaan has deployed 2,000 Avalon mining rigs in Kazakhstan, CoinDesk reported. Back in June, the rig manufacturer announced they were diversifying their mining business in Kazakhstan after the Chinese government cracked down on crypto.
Canaan CEO Nangeng Zhang commented:
As we integrate more industry resources into our operations, we believe this business segment will enable us to revitalize our mining machine inventory, shield us from bitcoin volatility and ensure our inventory sufficiency during market upturns.
After the deployment, Canaan’s Kazakhstan branch will begin to operate. More rigs are expected to arrive throughout the week. At the moment, they operate 32,000 terahash per second (TH/s). Canaan plans to deploy 1.8 exahashes per second in total.
Kazakhstan working on new laws to cope
The Central Asian country is working on new laws to cope with the influx of miners following the crackdown in China. 10 days ago, media reported that the domestic energy grid was falling apart at the seams because of the huge influx of bitcoin miners.
Hashrate has doubled since May
The country’s share of the global hashrate has roughly doubled since May, when Chinese miners began moving operations overseas.
Severe electricity shortage
Kazakhstan is now struggling with severe electricity shortages, which were difficult to anticipate in a country so rich in natural resources. The government blamed miners. Almaty, the largest city in Kazakhstan, experienced a total blackout this summer.
To resolve the issue, KEGOC, the national grid operator, is rationing electricity provided to mines. The Ministry of Energy proposed to set limits of 100MW for the entire country and 1MW for any newly licensed cryptocurrency mines.
Chinese miners took away power surplus
When miners began operating in Kazakhstan, they depleted all the excess power capacity. At the beginning of November, Minister of Energy Magzum Myrzagaliev told the press Kazakhstan’s electric power demand had been increasing at a steady rate of 1%-2% a year until the beginning of 2021, when it suddenly reached 8%, According to him, this was due to crypto mining.
Hope for the future
Some believe the influx of Chinese miners will help the country deal with outdated infrastructure, dependence on coal, and other age-old problems in the electric power sector. Despite the energy crisis mining has caused, stakeholders like Denis Rusinovich, co-founder of CMG Cryptocurrency Mining Group and Maverick Group, believe it has a good future in the country, in part “because the government wants to support renewable energy power production.”
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