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If you do not already know currently the number two country in hashrate mining power for Bitcoin, Kazakstan, is having a huge governmental crisis. The protests aimed to show discontent with the increase in gas prices for the carbon-rich nation have completely spiraled into total revolt. Since Kazakstan is a landlocked nation it completely relies on its neighbors for a ton of different needs that have to be shipped in. A huge benefit for the country though is the massive carbon reserves located within its borders providing cheap power and fuel.
Within a day of the protests breaking out in the autocratic strongman controlled country protestors had lit a presidential palace on fire, seized control of the largest cities airport, lit the largest cities mayor's office on fire as well as a ton of government vehicles across the nation. How the government responded was a mixture of severe and also begging for help. Police and military members had begun shooting protestors while the protestors were also killing said police and military members as well. This led the government to ask Russia to send in paratroopers on a "peacekeeping mission" something that has led to reports of explosions being heard across the nation as these troops move in and try to stifle the revolt.
As we have already seen prior to this crypto was pulling back however this supercharged Bitcoins pullback. The internet has been shut off for the country essentially erasing the hashrate they provide which is roughly 18% of the total supply. When China banned Bitcoin mining while a ton of mining equipment went to the US a ton also went to Kazakstan which jumped from 4% to 18% of the hashrate. Miners were drawn in by the cheap power and the shorter distance that things would have to be moved. Now all of this is in jeopardy and could lead to miners having to again move.
I imagine this being a huge contributing factor to the pullback rapidly accelerating. Bitcoin likes stability especially with its miners and now that is in jeopardy leading to asset dumping. Luckily for Bitcoin, the growing acceptance and the growing green energy mining options give these miners an option if they do decide to move. I am sure a country like El Salvador would absolutely love for any mining companies to decide to relocate to their country and probably would be willing to cut them a nice deal to do so.
Bitcoin is also now much closer to the level of pullback we expect to see from it from its highs last year. It could not shock me to see the coin dip under $40,000 a coin and if/when it does so I cannot wait to pour more money into it! The governmental situation though in Kazakhstan is something that is very important to keep an eye on as they do account for a huge hashrate mining percentage. I do not see it being a long-term issue though but I definitely see it as a contributing factor to the market acting as it has!
Please know I am not a financial advisor I am just someone who picked up on a trend and wanted to express it! Makes sure you always do your own research and never invest money you cannot afford to lose! If you enjoyed this article and would like to further support me below are a couple of referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_
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