According to the Reuters report, the Kuwait government has accused the crackdown on cryptocurrency miners across the country and worsened the lack of power as the summer turns around. Last week, the Ministry of Home Affairs declared a “extensive” security campaign to target houses that were renovated as mining centers.
Power grid under severe strain
Kuwait authorities said that encryption mining work said, “illegal power exploitation, and a power outage that affects housing, commercial facilities and important services, which suggests a direct threat to public safety.”
The lack of power in the Gulf State is the result of various causes, such as population growth, urbanization, temperature increase and delayed maintenance of current power plants. The authorities focused on the southern sector of AL-WAFRAH, which is known to have been used to operate about 100 houses.
Video: Encryption miners operated in Kuwait Bust#Kuwait #cryptominning #Cryptocurrency https://t.co/uji7sh6tal
-Arab Times -Kuwait (@arabtimeskuwait) April 25, 2025
Mining work uses cheap electricity
Some of the mining facilities of AL-WAFRAH use up to 20 times the average electricity level required by ordinary houses, according to the initial report of the electricity. The inexpensive electricity, which pays high subsidies in the United States, has brought a miner who hopes to benefit greatly.
A rendering of a crypto mining operation. Image: Gemini Imagen.
Legal gray areas solve the problem
Kuwait banned cryptocurrency transactions, but the country lacks the law on mining operation. This loophole has allowed the central bank to pay attention to investments in cryptocurrency, but miners can work as legal rimbo.
This case shows how encryption mining finds areas with low electricity costs. The same trend has been observed worldwide, and countries leading from Kosovo to Russia limit mining to avoid power shortages.
The initial result is a strong effect
The Ministry of Electricity announced that AL-WAFRAH’s energy consumption was reduced by 55% after the crackdown on last week. This steep reduction indicates that the crackdown was successful in the early stages.
Kuwait’s Cryptocurrency policy is completely conflicting with some neighbors. As Kuwait inhibited mining, Dubai attended a major encryption meeting with Eric Trump, the son of US President Donald Trump.
Cambridge Research estimates that Kuwait is responsible for 0.05% of global Bitcoin mining in 2022, but even this small rate can have a great influence on Kuwait’s relatively small electric grid.
Alex de Vries-Gao, a collaborator of Digiconomist, a crypto energy usage tracker, said, “In order to have a significant impact on Kuwait’s relatively small overall electricity use, it will only require a very small ratio of the entire Bitcoin mining network.
As the summer of Kuwait was heated up in the next few months, public officials continued to request citizens to reduce electricity consumption, anticipating the clamps of the miner during the hot summer.
Chart of TradingView, the main image of Unsplash
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