South American Country BANS Crypto Mining

By Vince • May 19, 2024 1:53 pm • Comments

Yet another South American country has moved to ban the mining of cryptocurrencies, citing concerns regarding the power grid.

Venezuela’s Ministry of Electricity has revealed its plan to disconnect Bitcoin, and other crypto mining operations, from the country’s power grid.

Although Bitcoin mining consumes less electricity than the current banking industry, and proof-of-stake consensus requires little electricity, Venezuela has struggled to provide basic services and infrastructural needs for its people.

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The Ministry of Electric Power announced in an X social post on Friday:

CoinDesk put Bitcoin mining energy consumption into sharper focus:

As of mid-July, a single Bitcoin transaction required 1719.51 kilowatt hours (kWh) – where a kWh is the amount of energy a 1,000-watt appliance uses in over an hour.

To put that in perspective, that is about 59 days’ worth of power consumed by an average U.S. household. On an average day, 240,000 Bitcoin transactions are sent over the network.

In April, Bitcoin.Com News reported that Paraguay also became critical of crypto mining in the country and sought a temporary ban on mining activities.

“Paraguay’s crypto ban: blaming Bitcoin miners for blackouts? Paraguay is considering a bill that would impose a 180-day moratorium on cryptocurrency mining due to its high electricity usage, with potential extensions until ‘appropriate regulations’ are established.”

Cosgrove Gaynard Solicitors reflected on potentially similar regulations coming to the United States.

They asked: “An emergency request for Bitcoin Mining electricity usage data has been issued in the US to collect data on the crypto mining industry, electricity usage, etc. Potentially laying the groundwork for crypto mining restrictions?”

According to Politico’s E&E News:

The U.S. Energy Information Administration estimates that mining for bitcoin and other digital currencies accounts for 0.6 to 2.3 percent of the nation’s electricity use.

But that figure is just an approximation based on worldwide data collected by Cambridge University and publicly available information about 52 crypto mining sites.

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