Kuwait Cracks Down On Crypto Miners Amid Power Shortages

Kuwait's government initiated a crackdown on cryptocurrency miners nationwide last week, accusing them of worsening power shortages as summer approaches, according to a Reuters report. The interior ministry announced a "wide-ranging" security campaign targeting houses converted into mining centers in Al-Wafrah. Authorities stated that these operations illegally exploit electric power, potentially causing blackouts affecting homes, businesses, and critical services. The ministry of electricity reported a 55% decline in energy consumption in Al-Wafrah following last week's crackdown. Some mining facilities in Al-Wafrah consumed up to 20 times more electricity than average homes, according to earlier reports from the ministry of electricity. Kuwait's cheap electricity, though heavily subsidized, has attracted miners seeking substantial profits. While Kuwait prohibits cryptocurrency trading, it lacks legislation governing mining operations, creating a legal loophole. Despite the central bank's warnings against crypto investments, miners have operated in this legal gray area. University of Cambridge research estimated Kuwait accounted for just 0.05% of global Bitcoin mining in 2022, but even this small percentage significantly impacts Kuwait's electrical grid.