Venezuela has joined the top 10 nations with the highest hash rate, but many miners have not yet legalized their situation. The authorities ban miners from working at home to avoid causing problems in their surroundings due to the collapse of electrical transformers.
The Venezuelan regulations in force state that Bitcoin mining is a right for every citizen willing to undertake it. Although the activity was previously illegal, now the authorities allow doing it in the country.
The agency regulating the mining activity in Venezuela is the National Superintendency of Crypto Assets and Related Activities (Sunacrip). It emerged to make the cryptocurrency mining industry harmonize with the energy potential of the South American country.
Cryptocurrency mining has had legal status in Venezuela since 2018. The low energy costs have allowed the country to join the top 10 nations with the highest hash rate. However, many miners have not yet legalized their situation.
Conditions to Mine Bitcoin in Venezuela
Bitcoin mining is a right for those who want to invest in it in Venezuela. However, the picture complicates as a large number of miners are still in an irregular situation.
Duly registered miners are seeking to promote legalization among their colleagues. Since the Venezuelan authorities penalized the business for many years, legality is still a difficult step to take. Although there remains a feeling of clandestineness, legalization seems the only possible way to strengthen the activity.
The government does persecute Bitcoin miners but instead wants them to continue conducting their business legally. Many mining devices are in commercial or residential areas, which negatively affects miners’ surroundings. For that reason, the authorities do not allow mining in such areas.
Mining Illegally Harms Both Miners and their Surroundings
According to Venezuelan regulations, a clandestine Bitcoin mining farm means that its owners are stealing a service that belongs to the country. Despite that, the authorities call on miners to stop working clandestinely to avoid penalties in the future.
There are many reasons why an illegal miner causes problems in his surroundings. Electricity transformers can collapse as they are not suitable for operating 3 or 4 machines in a house. That is only one of the many consequences of mining illegality in Venezuela.
The Authorities Streamline the Legalization Process
Due to the pandemic conditions and the fuel shortage crisis, it has been hard for miners to go from one place to another. Many Bitcoin mining farmers have not yet been able to consign the documents that the authorities require.
Sunacrip recently opened an office in the center of the country, which will allow the legalization process.
The regulatory agency also holds working meetings with miners and police forces to bring stability to the business. Besides, they work alongside the State electricity company (Corpoelec) to discuss the fees for this activity.
Given the importance of Bitcoin in the economy, the Venezuelan authorities have made efforts to legalize miners. The low cost of electric energy makes the country an excellent place to conduct that business. However, the COVID-19 pandemic and the current fuel crisis have made conducting this activity in the country very difficult.
By Alexander Salazar