According to the news agency BOLNews, the government of Khyber Pakhtunkhwa – one of the four provinces of Pakistan – has announced the launch of two state-owned mining farms to mine Bitcoin.
This move was one of the first precedents when the country’s government used its own resources to mine and profit from the main cryptocurrency. Moreover, such initiatives are being taken against the backdrop of a slowdown in the economic development of the state.
To begin with, a small explanation: mining bitcoins on a large scale requires serious financial investments, and it is practically closed for small fans of mining coins due to the high entry threshold. While users can easily mine Ethereum with multiple GPUs, mining BTC requires special ASIC miners, which have certain drawbacks. For example, unlike video cards, they are difficult to sell; in addition, ASICs can cope with only one task and a limited number of algorithms.
In addition, the hashrate of Bitcoin – that is, the total amount of computing power in the cryptocurrency network – is now at an all-time high. This means that mining cryptocurrency and receiving rewards is now more difficult than ever. At the same time, the record hash rate also means the maximum network security against possible attacks of 51 percent.
Here is an up-to-date Bitcoin network hashrate chart from CoinMetrics. The indicator flew above 150 million terahashes per second.
Taking this into account, it can be assumed that the authorities have invested a large amount of funds in the extraction of cryptocurrency. In addition, they clearly do not doubt the prospects for Bitcoin and certainly hope for further growth in the asset’s rate.
Mining cryptocurrencies at the state level
Ziaullah Bangash, an adviser to the provincial chief minister of information technology, said legislation to support such operations had been passed by the Provincial Assembly. A separate no-objection certificate was also adopted, allowing individuals to launch their own cryptocurrencies without fear of backlash from local regulators.
At the same time, Pakistan’s position on Bitcoin is similar to that of many other countries, Decrypt reports. The digital asset sector is still not developing at a normal pace due to bureaucracy, however, local governments and individuals are gradually pushing for regulations that can help accelerate the adoption of crypto in the country.
Cryptocurrency mining has become so popular that even states are now involved in it.
The Khyber Pakhtunkhwa Provincial Government has made its first efforts in this direction. The province’s natural cool mountainous environment encourages Bitcoin mining, with less wear and tear on hardware than in the hotter areas of Pakistan due to no need for serious cooling. At the same time, the news of the creation of a state-owned crypto farm coincided with the launch of a large private cryptocurrency farm for Bitcoin mining, created by local celebrity Vakar Zaka.
He announced this on his Twitter.
Finally, my dream project is approved, and after many years of suffering, I am launching the largest cryptocurrency farm in the region that you can invest in and earn.
Let’s hope that after the decision of the governing bodies, crypt will indeed become mainstream in Pakistan. Recall that altcoins have long been actively used by the population in countries with suffering economies – for example, in Venezuela. Investing in coins for local residents is the only way to avoid the huge inflation of the national currency.
We think the provincial leadership’s initiative sounds interesting. Yet Bitcoin has existed for a little over twelve years, which is why the cryptocurrency niche is rightfully considered young. Despite this, officials are ready to contact the blockchain asset industry and take part in its development. And this is despite the fact that analysts of the largest banks continue to call BTC “the largest bubble of humanity.”
Apparently, the authorities have the opportunity to improve the economic situation in the region – or at least try to do it. As long as their actions seem to be correct.