People in Georgia are turning to cryptocurrency mining for cheap energy as a pandemic hits tourism.

The government of Georgia, a tiny Caucasus country, has teamed up with the energy distribution business Energo-pro to combat the rising unlawful usage of power in the Svaneti area to mine cryptocurrency. Natia Turnava, the nation’s Minister of Economic and Sustainable Development, revealed the change earlier this week during a news conference.

According to the Novosti-Georgia news agency, the unusually high power usage of mining farms in the vicinity of Mestia‘s old town has been a heated subject for a month. Low power prices set for enterprises operating in the hilly terrain have drawn miners to Svaneti. The people of Mestia have free access to electricity.

Residents of Svaneti had to put up with a restricted power supply till the end of December. The shortages and damage to the electrical system have been blamed on underground crypto miners.

Minister Turnava said, “Of course, illegal consumption of electricity is unacceptable, especially the problems with home mining which exists there. We are working with the local government, as well as with Energo-pro Georgia which supplies electricity to Svaneti, in order to gradually resolve this issue.”

Residents of Mestia have staged repeated protests calling for the mining farms to be closed down, accusing local officials of shielding the miners. Meanwhile, Energo-pro Georgia has vowed to raise the region’s power bills. Despite this, and the demonstrations, consumption has remained stable.

Consumption has increased by 237 percent this year compared to past years, the municipality of Mestia said in a report last month. Residents participating in the minting of digital currencies were also encouraged to stop doing so by the local authorities.

Natia Turnava expressed her optimism that the tourism season in the area would not be jeopardized. Svaneti and Mestia have drawn thousands of tourists in the last decade because of their stunning scenery, medieval castles, and historical customs. However, locals have turned to mining as an alternative source of income since the number of visitors has decreased due to the Covid-19 outbreak.

A few years ago, Georgia became a mining hotspot when it rated as the second most lucrative bitcoin mining site behind China. However, the country also came in second in terms of the power required for digital currency mining, according to a 2018 report by the Cambridge Center for Alternative Finance (CCAF). Its proportion of the worldwide average monthly hashrate was 0.18 percent as of August 2021.

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