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Angola’s move to ban cryptocurrency mining continues to attract international attention. The Chinese Embassy, reminding of the law that came into effect on April 10, has warned cryptocurrency miners. According to the law, cryptocurrency mining is considered a crime and carries prison sentences ranging from 1 to 12 years.
Why Was Cryptocurrency Mining Banned?
This step aims to combat organized cryptocurrency mining networks and protect the national electricity system. Angola’s current electrical infrastructure struggles to meet the demand created by cryptocurrency mining. These activities, consuming about 9.6 MW of electricity per day, destabilize the local electricity supply and deepen the country’s energy crisis.
Despite Angola’s daily installed electricity production capacity of 6,200 MW, the demand is not being met. This situation negatively affects the country’s economic growth and development.
Angolan lawmakers approved the proposal to ban cryptocurrency mining and criminalize it in a vote. The bill targets individuals caught mining cryptocurrencies using computer systems and related equipment, imposing severe penalties including imprisonment.
China’s Economic Interest in Angola
China’s economic interest in Angola is notable. This relationship has strengthened over the last decade and was further solidified with an investment protection agreement signed in December. However, differences over cryptocurrency mining continue to test this relationship.
Bitcoin reaching its 840,000th block and experiencing its fourth halving event was a significant moment in the cryptocurrency world. The reduction in mining rewards helps keep Bitcoin‘s supply under control, while also becoming a factor that could influence prices.
At this point, the decisions Angola has made regarding cryptocurrency mining are important for national security and economic stability. These steps aim to protect the country’s energy resources and economic potential. However, the dynamics of international relations and the rapidly changing nature of the cryptocurrency industry require close monitoring of these developments.
