Crypto farms are being hunted down and closed down in Malaysia. What problems does mining pose for the country's power grid?

In Malaysia, due to excessive load on local power grids, the country's authorities began to look for crypto farms that illegally connect to power. The police, together with the local energy company TNB, conduct special raids during which they detain miners and destroy equipment.

Malaysian authorities have been talking about the problem of mining for several years now, claiming that this type of activity causes enormous damage to the country’s energy sector. The fact is that mining is a process that requires a large amount of electricity and causes serious power outages in Malaysia.

As a result of raids carried out by the Malaysian police, over the past two years, more than 600 people were detained who were illegally connecting to power grids and mining cryptocurrency. Many of the detainees rented apartments and used the owners' electricity. Without notifying them that they are going to engage in mining. During this time, more than a thousand mining rigs worth a total of about $16 million were seized and destroyed.

Popular region

The Asian region has recently become a very popular location among miners. The issue of migration began especially actively in 2021, when, after a complete ban on cryptocurrencies in China, miners began to migrate to countries relatively close to it - including choosing Malaysia for relocation.

Overloading of power grids as a result of their excessive activity has been noted in recent years not only in Malaysia, but also in other countries of greatest interest to miners - for example, in Kazakhstan, as well as in some states of the USA (in particular, Texas). According to calculations by the Texas department responsible for the electrical grid, the load on them will increase fivefold in the next two years.

According to data from the University of Cambridge, the global mining of Bitcoin requires approximately the same amount of electricity as is needed to meet the needs of entire countries - for example, Switzerland or Kuwait. According to other calculations, mining today accounts for about 0.5% of all electricity consumed in the world - about 91 terawatt-hours of electricity per year. This is 7 times more than the entire IT infrastructure of such a giant as Google requires.

Source: nytimes.com

Author: Dmitry Noskov - expert of the StormGain crypto exchange (platform for trading, exchanging and storing cryptocurrency)

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