The ongoing protests in Kazakhstan have had a significant impact on the Bitcoin network, with the country experiencing an internet outage. Due to the lack of internet access, the country’s massive Bitcoin mining network remained inactive throughout the day. This has resulted in a significant decrease in the Bitcoin network’s global computing power.
Bitcoin prices have lowered by more than 10% in recent days. Due to extensive protests in Kazakhstan, one of the world’s top cryptocurrency mining hubs was shut down. Bitcoin was trading near $42,000 late Friday night, down from over $48,000 at the end of 2021. The hash rate, which assesses the total computing power used for mining, fell on Wednesday. After the Kazakh government authorized a major telecommunications provider to curtail internet access throughout the country.
Bitcoin prices have lowered by more than 10% in recent days
The shutdown showed up in reaction to destructive uprisings over soaring liquefied petroleum gas prices, which are used as fuel by many Kazakh motorists. Many cryptocurrency miners had relocated to Kazakhstan. In order to take advantage of the country’s inexpensive electricity after neighbouring China, another major hub, prohibited them in May 2021. According to the Cambridge Center for Alternative Finance, Kazakhstan accounted for about 18 percent of the global hash rate in August. Trailing only the United States.
Because of the internet outage in Kazakhstan on Thursday, the global hash rate fell by about 14%. The shortage of Kazakhstan-based miners from the system for the day would have rendered mining Bitcoin easier for those in the United States and elsewhere. However, the decline in hash rate hurt the price of Bitcoin. Which fell on the crypto market, bringing down numerous other cryptocurrencies with it. Five thousand bitcoins have been in and out of crypto miners’ accounts.
Kazakhstan’s crisis has exemplified how geopolitical threats can affect bitcoin. Even though it is not handed out or backed by any government. Political and societal characteristics will play an enormous role in the cryptocurrency market in the future.