The aggregate Bitcoin mining power of the United Arab Emirates is projected to reach 400 megawatts, or 4% of Bitcon’s worldwide hash rate.
The United Arab Emirates (UAE), which has established itself as a pro-Web3 hub for businesses with a focus on cryptocurrencies, has become a significant location for Bitcoin mining in the Middle East. The UAE offers an appealing environment for mining operations, with more than 30 free trade zones and a rising contribution to the Bitcoin mining hash rate.
Bitcoin miner Marathon Digital and Zero Two, the digital assets division of Abu Dhabi’s sovereign wealth fund, partnered in May, marking the start of the UAE’s entrance into mining. Two mining sites in Abu Dhabi were established as a result of this partnership, with a combined capacity of 250 megawatts (MW).
Due to its energy efficiency and role as the UAE’s main commerce hub, Abu Dhabi has become a focus point for a variety of crypto mining activities. The perfect environment of the city makes it a great place for mining operations.
According to data from Hashrate Index, the UAE now has a combined Bitcoin mining capacity of over 400 MW, which makes up about 4% of the cryptocurrency’s overall hash rate. Although nations like the US, China, Russia, and Kazakhstan now control the majority of the world’s hash rate, the UAE has the potential to overtake them thanks to its wealth of resources.
The UAE has moved its focus from traditional oil and gas reserves to embrace renewable energy sources including solar and nuclear power as a major player in the global energy market. The nation has significantly lessened its dependency on natural gas for the production of electricity by adopting cleaner energy options.
Between the hottest and coolest months, the UAE’s electrical demand varies significantly, which causes a huge loss of generated power. The power and desalination plants in the UAE wasted almost 20 terawatt hours of energy in 2021 alone, which is equivalent to about $600 million. Bitcoin mining could help make use of this extra power and cut waste.
The UAE is in a good position to utilise its nuclear and renewable energy resources for mining operations in the next years since bitcoin mining companies prioritize the use of clean energy sources. The country’s miners might make effective use of the extra energy produced by these sources.
Miners can benefit from additional benefits in the UAE, such as a tax-free environment. The country’s growing popularity in the Bitcoin mining sector is a result of the favorable tax environment, which offers further incentives for mining businesses to locate their operations there.