Kuwait Cracks Down on Illegal Crypto Mining, 116 Questioned

Kuwait has intensified its efforts to combat illegal cryptocurrency mining, with authorities questioning 116 individuals as part of an ongoing crackdown. The investigations are focused on the unauthorized use of electricity for crypto mining activities across 59 residential properties. This illegal activity has reportedly placed significant strain on the national power grid, leading to widespread blackouts.

The public prosecutor has issued a stern warning, pledging to take strict legal action against those found to be violating the law. This escalation follows a previous warning from Kuwait’s Ministry of the Interior, which identified over 1,000 illegal crypto mining locations in the country. The ministry characterized crypto mining as an unlawful exploitation of electrical power and a direct threat to public safety.

In response to these findings, an intergovernmental committee launched a large-scale security campaign, targeting illegal crypto mining activities. This campaign was carried out by the Ministry of the Interior's Criminal Security Sector. The crackdown comes as part of a broader effort to enforce an absolute ban on all virtual asset/cryptocurrency mining activities, which was implemented in 2023. This ban was prompted by directives from authorities overseeing the Gulf nation's anti-money laundering initiatives.

Kuwaiti residents enjoy relatively cheap electricity, with rates estimated at 4.6 cents per kilowatt-hour, which is significantly lower than the U.S. average. However, the country's hot climate, with summer temperatures forecast to reach over 52°C, poses additional challenges to the electrical grid. Despite these factors, the government has urged residents to minimize energy usage and conserve power.

Crypto mining rigs typically require between 1,000 watts (1 kW) to 8 kW of power, making the practice energy-intensive. While crypto mining can impact electrical grids, the industry is gradually shifting toward more sustainable practices. Advocates argue that crypto mining can help stabilize power grids, and recent studies show that sustainable energy sources for Bitcoin mining have increased to 52.4% from 37.6% in 2022.