Kuwait Issues New Statement on Illegality of Cryptocurrency Mining

Kuwait's Ministry of Interior (MoI) has issued a statement stating that cryptocurrency mining is illegal and unlicensed in the country. Kuwait's Ministry of Electricity, Water and Renewable Energy officials stressed that there are over 1,000 cryptocurrency mining sites operating in the country.

In a press release posted on X, the Ministry’s General Department of Public Relations and Media clarified that cryptocurrency mining violates a number of important laws, including Law No. (56) of 1996 concerning the Industry Law, Law No. (31) of 1970 amending certain provisions of the Penal Code No. (16) of 1960, Law No. (37) of 2014 establishing the Communications and Information Technology Regulatory Authority (CITRA), and Law No. (33) of 2016 concerning the Kuwait Municipality.

The ministry noted that cryptocurrency mining results in significant energy consumption and increases the load on power grids, which could trigger power outages and pose a threat to public safety.

The warning was the result of a joint effort by the Ministry of Interior, the Ministry of Electricity, Water and Renewable Energy, the Communications and Information Technology Authority, the State Authority for Industry and the Kuwait Municipality. The actions are part of a coordinated national initiative to combat illegal practices and minimize their negative impact on the country's electricity infrastructure.

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The Ministry of Internal Affairs called on the offenders to immediately eliminate their actions, emphasizing that failure to comply with the requirements will lead to legal consequences. The offenders will be transferred to the relevant investigative bodies for further action in accordance with the current legislation.

Cryptocurrency trading and payments are also illegal in Kuwait

The Ministry of Finance does not recognize cryptocurrencies for official commercial transactions. Similarly, the Central Bank of Kuwait (CBK) prohibits the banking sector and companies under its control from engaging in cryptocurrency trading. The ban covers the use of cryptocurrency in electronic payments and intermediation in cryptocurrency transactions.[523] CBK has asked the Ministry of Trade and Industry to warn consumers about the risks associated with cryptocurrencies such as Bitcoin.

Kuwait is one of the most accessible countries for cryptocurrency mining

In 2023, the country was ranked as the most affordable place to mine Bitcoin (BTC) in the world. One review suggested that mining costs in Kuwait were only $1,400 per BTC in 2022, while in Texas, the cost was over $18,000 (Bitcoin was worth over $40,000 at the time).

According to data compiled by Best Brokers, Bitcoin mining consumes around 140,336 GWh annually, which is more than the annual electricity consumption of countries such as Ukraine or Malaysia.

Source: cryptonews.net