Venezuelan authorities have launched a crackdown on crypto miners in a bid to protect the South American nation’s power grid.
In an Instagram post on Friday, the country’s Department of Energy (Spanish acronym: MPPEE) said that it would disconnect all mining operations from the country’s National Electric System (SEN).
Miners are needed to help Bitcoin and other cryptocurrencies to work as intended. Such operations are often large warehouses full of computers that use a huge amount of energy to mint new digital coins and keep a crypto network secure.
However, such operations have come under criticism by lawmakers all over the world for the amount of energy they consume.
MPPEE said in its post that the move was being made in a bid to “avoid the high impact on demand” on the grid, and to allow the SEN “to continue offering an efficient and reliable service to all the Venezuelan people.”
The post featured a video of authorities raiding what looks like crypto mining operations.
Venezuela—which has experienced a devastating economic collapse since 2010—has long suffered problems with its grid. Although the problem isn’t as bad as it was back in 2019, some of the country’s rural areas still experience blackouts.
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The oil industry in Venezuela will soon be back under U.S. sanctions after a six-month pause, and the economic impact has reportedly driven the South American nation to accelerate its adoption of cryptocurrency in oil trading. As part of efforts to encourage Venezuelan leadership to conduct a fair presidential election in July, the U.S. implemented General License 44, which authorized transactions related to oil or gas sector operations in Venezuela. However, after opposition candidate Maria Cor...
Last September, Venezuelan police raided a prison where inmates were running secret Bitcoin mining operations. And earlier in 2023, the country’s regulator launched a crackdown on miners.
Despite this, the country is still keen on using crypto: The state-run oil company, PDVSA, reportedly wants to use digital asset USDT to exchange for its crude and fuel exports as a way to get around U.S. oil sanctions, Reuters reported last month.
Edited by Andrew Hayward
