Venezuela Passes Law Legalizing Cryptocurrency 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 Cryptographic Assets and Related Activities (Sunacrip). As part of the new regulations, all entities and individuals interested in the legal mining of bitcoin and other cryptocurrencies must now apply for a license from the agency.

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

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

Authorities will oversee both the creation and import of mining equipment. Similarly, bitcoin and other cryptocurrency mining farms will be able to operate with the support of the state, but only if inspected by Sunacrip.

As reported by News.bitcoin.com in July, Venezuela banned bitcoin mining operations in “all low-income neighborhoods with subsidized housing” due to what the authorities called “an excessive amount of energy consumption. “. Before that, the Venezuelan army had seized around 315 Bitmain Antminer.

However, according to regulations, which went into effect after September 21, Venezuela now wants “those who use ASIC equipment to mine bitcoin and other cryptocurrencies” to connect to NDMP. The authorities now seem less concerned about excessive energy consumption.

Miners operating outside the pool will be subject to “the measures, infringements and sanctions established in the decree document”.

Meanwhile, the report explains that if the Venezuelan authorities insist on controlling and managing the NDMP, it will leave the government to distribute the rewards to the 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 territory for bitcoin mining. With a hashrate share of around 0.42%, Venezuela is the only Latin American state to appear in the top ten of Cambridge University 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 rise.

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

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