Bitcoin took a hit on Thursday, 6 January 2022, after the internet in Kazakhstan was shut down amid intensifying violence. The central Asian nation has been rocked by violent clashes between protesters, police, and the army. The protests began in the west of the country over the weekend, after a sharp rise in fuel crisis, and quickly spread through cities across the nation.
The internet was shut down nationwide on Wednesday, 5 January 2022. And though the intent appeared to be to disrupt the protesters’ communications, the effects of the blackout have spread further.
In 2021, Kazakhstan became the world’s second-largest center for Bitcoin mining after the United States, according to the Cambridge Centre for Alternative Finance, after China, a major hub, clamped down on crypto mining activity. As of August 2021, Kazakhstan was hosting 18% of global Bitcoin mining, according to Fortune.
Within the hours of the outage, Bitcoin’s computational power sank. Bitcoin and other cryptocurrencies are created or ‘mined’ by high-powered computers, usually at data centers in different parts of the world that compete to solve complex mathematical puzzles in a highly energy-intensive process.
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