Kyrgyzstan closes cryptocurrency farm with 2,500 mining rigs – mining bitcoin news

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Kyrgyz authorities have discovered and shut down a large crypto mining farm in the north of the country. Law enforcement officials say the illegal coin-minting facility has inflicted “colossal damage” on the country’s power grid and they are still trying to estimate the losses.

Underground crypto farm destroyed in Kyrgyzstan

The Central Asian region, including the Republic of Kyrgyzstan, has recently become a hotspot for cryptocurrency mining. Companies involved in mining digital coins have been drawn to its low energy tariffs as part of the ongoing crackdown on the industry in China.

The influx of miners has been blamed for power shortages and some countries have taken steps to alleviate a growing energy deficit. In early October, reports revealed that the Kyrgyz government had raised the electricity tariff for crypto mining companies, among other consumers, citing the energy-intensive nature of their operations. Lawmakers in neighboring Kazakhstan have proposed a similar measure.

Authorities in Bishkek are also targeting underground cryptocurrency miners. In May, law enforcement officers seized 2,000 mining devices at a number of facilities manufacturing illegal digital currency in several locations in the capital and the Chuy region.

In a similar operation recently, the State Committee for National Security (GKNB) dismantled a large illegal mining farm in the town of Druzhba, in the Issyk-Ata region. Its agents confiscated 2,500 other mining machines, a press report said.

According to a press release issued by the department and quoted by Sputnik Kyrgyzstan, the data center – which operated in a greenhouse – was operated by foreign nationals. The GKNB further notes that their illegal activities have “caused colossal damage to the power grids of Kyrgyzstan”.

Investigators are now working to assess the losses for the state and determine whether the mining equipment was legally imported into the country. The committee added that it is also trying to identify everyone involved in the business.

Kyrgyzstan has taken steps to regulate its growing crypto mining industry. In August 2020, the Ministry of the Economy presented a bill establishing a taxation of mining activities. The legislation proposes a 15% tax on the cost of electricity consumed to mint digital currencies. The law also requires mining companies to register with regulatory bodies in order to obtain permission to operate in the country.

Do you expect Kyrgyzstan to continue its crackdown on illegal crypto-mining operations? Share your thoughts on the subject in the comments section below.

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