Tech

Bitcoin price plunges as Kazakhstan cuts internet amid violence against crypto miners

Bitcoin price fell this week after Kazakhstan cut off internet supply to quell violent anti-government protests, hitting crypto miners hardest.

The coveted cryptocurrency fell below $42,000 on Thursday, down from a high of $69,000 in early November of last year – cleaning investors.

Bitcoin price plunges again, but this time is believed to be related to the conflict in Kazakhstan

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Bitcoin price plunges again, but this time is believed to be related to the conflict in KazakhstanCredit: PA
Bitcoin price has dropped to 4-month low

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Bitcoin price has dropped to 4-month lowCredit: Yahoo Finance

Experts say the drop is related Kazakhstan cut off internet supplies to quell recent violent protests against the government and President Kassym-Jomart Tokayev.

Russia’s “peacekeeping” troops have landed in the financial capital Almaty after protests over recent gas price hikes turned deadly.

A total of 13 policemen were killed – and the Kazakh government says three officers had their heads cut off.

Recent power outages in Kazakhstan – the second largest Bitcoin mining center after the US, which accounted for 18% of total global Bitcoin production last August, according to Reuters – saw 1/5 of the cryptocurrency network is in the dark.

With internet access cut off, the number of computers needed to maintain the network has dropped dramatically.

According to The Block’s Larry Cermak, the ban led to a 12% decrease in “hashrate” – a term used to describe the amount of computing power required to run the Bitcoin network.

The looming news of a rate hike by the US Federal Reserve is also believed to be behind the recent drop, according to the report. Sky News.

Minutes of this week’s Federal Reserve meeting signaled a potential US interest rate hike – sending a wide range of assets from cryptocurrencies to stocks plummeting in value.

Computers are needed for complex mathematical calculations to get a new Bitcoin into circulation online.

This process is also known as mining and it requires a large amount of energy.

Bitcoin mining is beset by controversy because of the amount of fossil fuels required to mine the cryptocurrency and its negative impact on the environment.

China was once the largest Bitcoin mining country until a state crackdown on the practice sent miners to Kazakhstan, where fossil fuel energy is abundant and cheap.

Unfortunately for these miners, Kazakhstan is currently experiencing a period of civil unrest.

Protesters have been engaged in violent clashes with the country’s security forces since January 2.

Kazakstan President Tokayev is said to have enforced the order to block internet access on January 6.

The crypto market was in a red sea on Friday morning with so many other popular cryptocurrencies crashing.

Ethereum is the second largest cryptocurrency and has dropped 12%.

https://www.thesun.co.uk/tech/17261051/bitcoin-crash-amid-kazakhstan-internet-cut-out/ Bitcoin price plunges as Kazakhstan cuts internet amid violence against crypto miners

Caroline Bleakley

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