| The connection is far from remote. Bitcoin caused an almost instant 10% increase to electricity usage in Kazakshtan. For obvious reasons, all of that increase has to be supplied with additional gas and coal consumption. Because of the contracts that Kazakshtan signs for its fossil fuel supply, this extra capacity has to be at a higher cost. At least, that's how these contracts typically work, and I'd be very doubtful that Russia would agree to subsidies Kazakh crypto miners, but they do subsidise residential energy consumption in exchange for other concessions. Indeed, normally, Kazakstan wouldn't see a natural gaz price increase because they negotiate fixed cost contracts with Russia (at least, this is what they used to do and what its neighbors do right now). If they exceed baseline capacity, prices rise significantly. This means that the price of electricity and fossil fuel must increase strongly, and the proximal cause is indeed Bitcoin. As far as inequality, Kazakhstan has a Gini coefficient of around 27.4, which is lot lower than lost countries. If this was actually caused by inequality, we would expect to see similar conflicts in many more countries. On the other hand, rising natural gas and electricity prices are a much stronger and more frequent signal of social unrest, with dozens of precedents all over the world. Because of this, it seems to me that rising energy prices are indeed the proximate cause of the current unrest, and Bitcoin is likely the proximate cause of rising energy prices. |
I agree with this. I also agree with nalrey that energy prices are the spark, not the powder keg.
But still, it's a tough pill to swallow that spending a whopping 8% of the country's energy generation capacity on bitcoin mining is even remotely reasonable during an energy crisis...