Friday, November 27, 2020
Home Bitcoin News Venezuela Passes Law Legalizing Crypto Mining, Forces Miners to Join National Mining...

Venezuela Passes Law Legalizing Crypto Mining, Forces Miners to Join National Mining Pool

Reports say Venezuela has now legalized bitcoin mining following the decree recently issued by the National Superintendency of Crypto Assets and Related Activities (Sunacrip). As part of the new regulations, all entities and individuals interested in legally mining bitcoin and other cryptocurrencies must now apply for a license from the agency.

According to a report, the decree will result in the creation of a National Digital Mining Pool (NDMP), a body that “seeks to bring together all the miners operating on the Venezuelan territory.” Meanwhile, the decree document, which was signed by Joselit Ramirez the superintendent of Sunacrip, does not specify “how much it will cost to obtain these licenses.”

However, to ensure miners conform with these new regulations, the decree reportedly states that:

The authorities will supervise both the creation and importation of mining equipment. Similarly, mining farms for bitcoin and other cryptocurrencies will be able to operate with the support of the State, but only if they are inspected by Sunacrip.

As reported by News.bitcoin.com in July, Venezuela banned bitcoin mining operations in “any low-income neighborhoods with subsidized housing” due to what authorities termed “an excessive amount of power consumption.” Before that, the Venezuelan military had seized approximately 315 Bitmain Antminers.

However, according to regulations, which came into effect after September 21, Venezuela now wants “those who are operating ASIC equipment for mining bitcoin and other cryptocurrencies” to connect to NDMP. Authorities now appear less concerned about excessive power consumption.

Miners operating outside the pool will be subject “to the measures, infractions, and sanctions as set forth in the decree document.”

Meanwhile, the report explains that if Venezuelan authorities insist on controlling and managing the NDMP, this will leave the government in charge of distributing rewards to miners. This, however, creates risks for miners as the pool operator can arbitrarily freeze funds or delay payments.

The crisis-torn country tops peer-to-peer bitcoin trading volumes in the region alongside Brazil, while it remains a key bitcoin mining territory. With a share of the hashrate around 0.42%, Venezuela is the only Latin American state to feature in Cambridge University’s top ten list of countries with the highest bitcoin hash rate.

However, now that the government has formalized bitcoin mining, Venezuela’s share of the total hash rate is likely to increase.

What do you think of this latest move to regulate bitcoin mining in Venezuela? Tell us what you think in the comments section below.

Tags in this story
ASIC, Bitcoin, Bitcoin hashrate, Bitcoin trading volumes, Bitmain Antminers, Cambridge University, Energy Consumption, Joselit Ramirez, Latin America, Sunacrip, Venezuela bitcoin mining

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Read disclaimer

Popular Articles

Facebook’s Libra to launch by January 2021 acc. to reports

After going back and forth with its digital currency, Facebook has announced the launch of its cryptocurrency, Libra by January 2021. According to reports,...

Chinese Police Seize 1% of Bitcoin’s Total Supply

In brief Chinese authorities have seized over $4 billion in crypto assets. The funds were part of a major Ponzi scheme that exploited over two million...

Binance lists DAI and de-lists EOS from P2P platform

Major crypto exchange, Binance, announced that they will be adding DAI and removing EOS from their Peer to Peer (P2P) trading platform. In the announcement,...

Yearn.finance Announces Partnership With Cream and New Lending Project: Stable Credit

Yearn.finance founder Andre Cronje has recently published details of an upcoming integration with Cream, a lending protocol in the decentralized finance (DeFi) ecosystem. For...

Why Bitcoin Crashed by $3000 and Is Currently Undergoing a Sharp Price Correction

After a bullish rally where Bitcoin soared past $18,500 on certain exchanges, the digital asset underwent a notable price correction, trading dropping below $16,500. Bitcoin’s...

Sale of Asian Exchange Data Could Create Revenue Stream of $4.23 Billion Per Year Says Leading Strategy Consultants

Quinlan & Associates, a leading independent strategy consultancy specializing in the financial services industry has released a report exploring the various avenues through which Asian...