Mongolia is a fabled land, with its ancient steppes stretching far out into the horizon. It is the land of the warrior Mongols and their ancient leader Genghis Khan. During the Cold War, it fell under the Soviet sphere of influence, but since then has emerged as a leader of development. It has become an attractive place for investors, not least for its vast crypto-mining capabilities.
Mongolia and cryptocurrency
Mongolia, like its neighbour Russia, was once averse to cryptocurrency. But in 2019, the Mongolian government started acknowledging the benefits that could accompany cryptocurrency usage in the country.
In 2019, Forbes reported that the Mongolian government had partnered with Terra, a blockchain payment system. They have been working together to integrate digital payment systems into the country’s financial sector. It was reported that there are hopes this will be the beginning of vast developments in the field in Mongolia.
Mongolia for the most part is a largely cash-based economy. But it recently released its first digital currency, called Mobicom or “Candy”, which is pegged to the country’s fiat currency, the Tugrik.
Mongolia was quickly hailed as an emerging centre for crypto-mining. Its cheap electricity structures and cold weather prove desirable for this venture, reported Nikkei Asian Review.
The cheap electricity is a boon for running a plethora of computers, which crypto-mining needs. Moreover, the cold weather helps cool down these computers, which work overtime and thus heat up quite frequently. Many hoped that crypto-mining systems would add to Mongolia’s cryptocurrency boom.
However, reports claim that wide-scale crypto-mining in Inner Mongolia may be coming to its end. The region is reducing subsidies on electricity, thus making it more expensive for crypto-miners to practice their skill, reported Decrypt. Though this only applies to the autonomous region within China’s borders, analysts envision it could also affect Mongolia proper.