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Kuwait is cracking down on illegal BTC block reward miners, initiating 31 new investigations amid a surge in electricity demand as summer temperatures rise.
The country’s Public Prosecution office revealed that it had questioned 116 individuals allegedly mining BTC in nearly 60 residential properties.
The office warned residents against illegally mining BTC, reminding them that electricity must be used exclusively for its intended purposes, as outlined by the law. Investigations led by the office had revealed that hundreds of Kuwaitis were causing damage to the grid with their BTC mining rigs.
The crackdown comes at a time when the Middle Eastern oil-producing nation has been grappling with massive electricity demand as the summer sets in. In recent weeks, the government has cut power to some areas for maintenance and capacity expansion as it prepares for a scorching summer. Even with the added capacity, experts say the country will still not meet the needs of its people, falling short by 1,600 megawatts this year and over 5,600 megawatts by 2029.
This has made the government vigilant regarding illegal power consumption, and BTC miners have been among its prime targets.
Kuwait’s southern governorate of Ahmadi has been the most affected. In the southernmost area of Wafra, the government says over 100 residential homes were found to be mining BTC, burning through more than 20 times the average household consumption—following a government crackdown, consumption in the area dipped by over 55%, local outlets report.
Some local experts have blamed the government’s lax oversight for the rising wave of illegal miners. Saud Al-Zaid, a former board member at Kuwait’s Communications and Information Technology Regulatory Authority, says the miners exploit the regulatory loopholes.
“They saw government subsidies, saw the absence of oversight, and saw no laws in place, so they exploited the situation to their benefit,” he stated.
Kuwait is among the smaller block reward mining nations. According to data from the University of Cambridge, the country only accounted for 0.05% of the BTC hashrate in January 2022. However, with Kuwait’s overall power production being lower than most nations, even smaller BTC mining operations could have a significant impact.
The crackdown comes just over a month after the Kuwaiti government revealed that there were over 1,000 illegal mining operations in the country. It warned all violators to shut down or face legal consequences, noting that BTC mining is an “unlicensed activity and a direct violation of the country’s law.”
HIVE Digital expands Paraguay operations
Meanwhile, HIVE Digital Technologies (TSXV: HIVE), one of the largest BTC miners globally, is expanding its operations in Paraguay as it diversifies from North America.
HIVE recently announced that its mining capacity had increased 10% from March, hitting 7.3 exahash per second (EH/s). The bump was due to the operationalization of its 100-megawatt plant in Paraguay. The company intends to increase its hashrate by 2 EH/s monthly to hit 11.5 EH/s by June.
HIVE’s expansion in Paraguay follows the acquisition of a 200MW facility in the eastern Paraguayan district of Yguazu from Bitfarms for $85 million.
“This expansion provides HIVE with a strategic advantage to scale production using clean hydroelectric power. However, we remain vigilant, as global supply chain challenges and trade tensions over tariffs could introduce potential disruptions,” commented Chairman Frank Holmes.
In a separate interview, CEO Aydin Kilic noted that the miner selected Paraguay for its low-cost energy, political stability, and government, which welcomes investment from foreign firms. He added that the firm intends to scale its facilities to 300MW this year.
HIVE has also been partnering with local stakeholders, including establishing strong relationships with vendors and hiring local experts.
“Our goal is to create a local ecosystem of support that keeps costs stable while boosting uptime and efficiency,” Kilic stated.
Beyond Paraguay, the miner is expanding in Venezuela. COO Luke Rossy revealed that the firm intends to deploy 100MW of air-cooled containers in the country by November.
While it expands its operations in South America, HIVE relocated its headquarters to Texas earlier this year, citing increased ‘crypto’ support under the Trump administration.
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