The Bitcoin hashrate for some mining pools recovered strongly on Monday in the wake of Kazakhstan restoring the internet in most parts of the country.
On Monday, January 10, the hashrate for major Bitcoin mining pools neared recovery as Kazakhstan restores the internet partially. This comes as a major breather and relief for miners following an internet blackout in the country.
Bitcoin Hashrate amid the Crisis in Kazakhstan
According to data from Bitcoin mining pool BTC.com, the hashrate of the top mining pools tanked 11% between January 5-6. This is because the government announced an internet blackout following major protests in the country. However, this loss has now narrowed to 2.2%.
Post the Chinese ban in mid-2021, several miners flocked to Kazakhstan which has now become the world’s second-largest Bitcoin mining destination. Thus, it also accounts for one-fifth of the total global Bitcoin hashrate. On the first spot is currently the United States.
Speaking to CoinDesk on Monday, the head of the Kazakh National Association of Blockchain and Data Center Industry – Alan Dordjiev – said that the situation is almost resolved and crypto mining data centers are getting back online.
Dordjiev said that they have restored internet connectivity in most parts of the country. However, there are still some interruptions in places like Almaty, the former capital of Kazakhstan. But crypto mining regions are “totally fine,” he said. Internet tracker Netblocks also confirmed the claims on Monday.
ℹ️ Confirmed: Internet connectivity has been significantly restored in #Kazakhstan as of Monday morning for the first time since Wednesday’s near-total telecoms blackout. It is unclear whether the restoration will be sustained 📈
📰 https://t.co/Op5GwzXKbh pic.twitter.com/qzKuun1IE8
— NetBlocks (@netblocks) January 10, 2022
But last week, NetBlocks has pointed out that the fact that multiple providers lost connectivity simultaneously “indicates a centralized kill-switch”.
NetBlocks – Internet Connectivity Not Sufficient Enough
While NetBlocks confirmed the restoration of the internet across Kazakhstan, it said that it’s still not enough to support crypto mining operations. Speaking to Forkast, Isik Mater, director of research of internet monitor NetBlocks said:
“The restorations, however, are limited, unpredictable and don’t satisfy the requirement for a stable connectivity needed for cryptocurrency mining or blockchain applications”.
It’s difficult to say that how long the internet will continue to operate. Although the internet restores, there’s a high level of unpredictability.
Kazakhstan-based miners have had a tough time over the last few months. The country’s national grid has been struggling since September to keep up with the increased demand from the miners. As a result, some crypto miners are also mulling to move to overseas locations.
The recent episode shows that while Bitcoin is completely decentralized, its mining is not. It remains vulnerable to certain locations as well as the geopolitics surrounding it.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
