BitFuFu is abandoning its mining rigs in Kazakhstan and buying new ones from Bitmain and setting them up in the U.S., after weeks of power rationing in the Central Asian country, BitFuFu told CoinDesk on Thursday.
- Kazakhstan has been facing severe electricity shortages, partly due to the influx of crypto miners in the country, but also pre-existing problems with its energy infrastructure. The national grid operator moved to ration electricity to crypto mines in September.
- In November, the Ministry of Energy assured the industry that they won’t restrict electricity to legal mines. But the rationing did not stop. Last month, miner Xive shut down a 2,500-rig facility in Kazakhstan due to energy shortages. Industry sources estimate 200MW-500MW of legal mines have been cut off from the grid.
- BitFuFu’s new machines have already arrived in the U.S., a company spokesperson told CoinDesk. The company previously told users that they were facing delays taking the machines through customs and transporting them to the mines due to the Thanksgiving holidays.
- BitFuFu users have been watching their investments sit idly as the platform’s Kazakhstan facilities are offline.
- One user told CoinDesk that their machines have been completely offline for a little over one month, adding that he’d leave the platform if they gave him his money back. Another said disruptions started in mid-October, and that they are worried, but not angry at the service. Users who spoke to CoinDesk refused to be named because their contracts with BitFuFu include anti-defamation clauses.
- The mining platform acknowledged the problem stemming from Kazakhstan’s electricity rationing in an Oct. 14 Telegram message, saying it would compensate users by extending their contract for as long as their machines have been offline.
- According to the Financial Times estimates, BitFuFu has 80,000 rigs in Kazakhstan after moving there from China due to the government crackdown on crypto mining. A company spokesperson refused to comment on the estimate.
- The company spokesperson told CoinDesk they might try to sell their machines in Kazakhstan, but they have not reached a decision yet.
- BitFuFu is a platform which enables users to invest in mining without having to operate the facilities.