The government of Kuwait has put forth a stern warning to citizens that states that cryptocurrency mining is an illegal and unlicensed activity within the jurisdiction of the country. The position, voiced by the Ministry of Interior (MoI), highlights the government’s growing worry about the socially irresponsible activity because of its impact on the nation’s infrastructure and public safety.
An Unambiguous Announcement: Mining Cryptocurrency is Illegal
In a public statement put out on X, ‘X,’ also known as Twitter, the MoI’s General Department of Security Relations and Media has expressly confirmed the unlawful existence of cryptocurrency backbone mining within the borders of Kuwait. Using social media as a broadcasting platform was a step in the contemporary direction in the means of communication with the public. This activity has been identified as a breach of a number of statutes, including those at the industrial governance level, portions of the penal code, communications and information technology law, and other municipal acts. The regulations mentioned form a comprehensive enough legal basis for the government’s action.
Depleting Power: A Threat to Public Safety
A major reason for Kuwait’s fierce position is the extreme burden that crypto mining places on the country’s power grid. The Ministry of Electricity, Water, and Renewable Energy has reported that there are more than a thousand crypto mining operations in the Kuwaiti territory. The MoI underscored that this energy spending is within the bounds of electricity consumption, but what is useful is wasted, and resources that are useful are depleted. The added energy consumption also increases the chances of blackouts for essential services. The added consumption also endangers public safety.
Coordinated National Initiative: Addressing Illegal Practices
This isolated warning from the MoI is an aftermath of collaborative work conducted by the other government bodies. The Ministry of Interior, the Ministry of Electricity, Water and Renewable Energy, the Communication and Information Technology Regulatory Authority, the Public Authority for Industry, and Kuwait Municipality have been part of one plan. Their goal was to eliminate the challenges of unregulated/illegal crypto mining activities and reduce their negative impact on Kuwait’s national electric grid infrastructure.
A Legal Notice: Comply With The Rules, Or Get Sued
The recent statement made by the Ministry of Interior concerning the people and businesses under the umbrella of cryptocurrency mining is rather blunt: these people/companies must both stop and fix their activities. It highlights that any further inaction will invoke stern legal consequences. If found in violation, they will be subjected to the appropriate investigatory bodies and subsequently litigated in accordance with the State of Kuwait laws.
Commissioning Violations: No Mining Is Not The End
Kuwait has an even harsher approach to cryptocurrency than mining. Auditing entities like the Ministry of Finance do not recognize cryptocurrencies as a valid form of payment for commercial activities. Furthermore, the Central Bank of Kuwait (CBK) absolutely forbids all controlled banking institutions and companies from trading in cryptocurrencies. This also covers mediating the acceptance of cryptocurrency for electronic payment channels between prospective transacting parties. The CBK has also sought the powers of the Ministry of Commerce and Industry to warn the general populace regarding the financial dangers of cryptocurrencies, including Bitcoin.
The Paradox of Kuwait : A Cheap Mining Center
It’s really interesting how Kuwait is home to some of the cheapest cryptocurrency mining regions around the globe. In 2023, projections even referred to the country as the cheapest bitcoin miner internationally, considering the cost to mine 1 bitcoin in Kuwait was only \$1,400 in 2022 as opposed to Texas’s \$18,000 the same year (when bitcoin’s worth was pretty high). In Kuwait, it was exceptionally low. This low price is incredibly appealing to Kuwait for offshore, illegal, energy-laden mining activities.
Safeguarding Utilities and Law Enforcement
Kuwait has underscored the country’s refusal to cryptocurrency mining as a statement of power that preserves energy in infrastructure while safely policing the public. Illegal mining activities have the potential to trigger a collapse of power escalation and the country’s energy infrastructure, which, combined, are capable of triggering unified action. While miners may be lured internationally by reduced costs, the message is absolute: these operations are prohibited, and violators will face legal consequences.
