Home News Bitcoin hashrate fell due to internet shutdown in Kazakhstan

Bitcoin hashrate fell due to internet shutdown in Kazakhstan

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On January 5, amid ongoing protests in Kazakhstan, there was a complete shutdown of the internet, including at wired operators. According to the NetBlocks service, on January 6, the shutdown continued. The local newspaper Vlastkz confirmed this.

Thus, the internet did not work for more than five hours on Wednesday in most of the country. Some wired and mobile providers continued to provide customers with access to the network. In Almaty, the wireless connection is still disabled for most operators.

According to BTC.com, in a few hours of the absence of the internet in Kazakhstan, the hashrate of Bitcoin fell by 12%. At the time of writing, the total computing power of the network is estimated at 179 exahash per second (EH/s). Which is higher than the indicator for January 4.

The situation has also affected cryptocurrencies’ exchange

Furthermore, the situation has also affected the exchange of cryptocurrencies. At the time of writing, the price for 1 BTC paired with Kazakhstani tenge (KZT); starts from KZT 19,264,155 (~$44,300) on the Binance peer-to-peer (P2P) platform.

Moreover, the Bitcoin premium on P2P platforms often occurs against the background of acute political and economic instability. It remains unclear whether the exchange is taking place at increased prices; since the central bank of Kazakhstan has temporarily suspended the work of banks and other financial organizations.

The correlation of hashrate and bitcoin price remains a matter for discussion. Some believe that there is a causal relationship between the two indicators. Others believe that price fluctuation is always the result of a combination of variables. In any case, there are not sufficient arguments to assert that intraday fluctuations in the hashrate are immediately reflected in quotes both in general and in a specific situation on the night of January 6.

Ban on mining cryptocurrencies in China

In 2021, due to the ban on mining cryptocurrencies in China, some miners moved their equipment to Kazakhstan. The initiatives of equipment manufacturers also indicate an increase in the interest of miners in operations in the country. In November, Canaan delivered a batch of 2000 AvalonMiner brand ASICs to the country.

Later, the company signed partnership agreements with several local enterprises. At the end of 2021, about 10,300 devices from Canaan were already operating in Kazakhstan.

In December 2021, some miners began to leave Kazakhstan amid problems with electricity.

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