UAE authorities have told farmers within its jurisdiction that the country will no longer tolerate crypto mining on firms. That is according to a local media report by Khaleej Times.
Per the report, The Abu Dhabi Agriculture and Food Safety Authority claim that using a farm site for mining activities amounts to a “misuse of the farm for purposes other than its intended use.” The government agency also added that farmers or anyone caught in the act faces penalties of up to 10,000 UAE dirhams (approximately $2,722).
For clarity, crypto mining simply refers to an activity in which users compete to earn cryptocurrencies. They usually get rewarded in freshly-minted crypto after they must have completed mathematical puzzles and secured the network.
What This Means for Crypto Mining in The UAE
Interestingly, the latest development appears to negate an earlier report that shows that the region is relatively friendly to mining activities. Last year, the UAE emerged as a pro-Bitcoin mining jurisdiction in the Middle East. Data placed the UAE’s combined Bitcoin mining capacity somewhere around 400 megawatts. At the time, that was 4% of Bitcoin’s global hash rate.
Going by the recent turn of events, it would be understandable to think that the UAE might be starting to take a hostile approach to crypto mining in general. However, that is not the case.
The latest advisory specifically targets farm sites and does not outrightly ban crypto mining. So, the UAE remains friendly to crypto unlike other Middle Eastern countries who have been extremely hostile to digital assets.
Kuwait is a prime example of the above statement. Last July, Kuwait’s primary financial regulator, the Capital Markets Authority (CMA), placed an outright ban on all crypto-related activities, including mining.
What The Records Say
Notably, the UAE has been welcoming crypto-focused projects with open hands. As a fact, perhaps more often than usual in recent times.
To put the above statement into perspective, in May alone, the country allowed the expansion of blockchain analytics firm Chainalysis and institutional infrastructure provider Blockdaemon into its borders.
On May 8, Chainalysis established its regional headquarters in Dubai. Five days later, Blockdaemon also opened a new office in Abu Dhabi after being approved by the Abu Dhabi Global Market (ADGM).
