UAE: A Thriving Hub For Bitcoin Mining In The Middle East

Jul. 6, 2023
UAE: A Thriving Hub For Bitcoin Mining In The Middle East

The United Arab Emirates (UAE) is gradually becoming a top Bitcoin (BTC) mining destination in the Middle East. The country has established itself as a pro-Web3 destination for crypto-focused companies with 30 free trade zones and a growing contribution to the Bitcoin mining hash rate.

The United Arab Emirates combined Bitcoin mining capacity is estimated to be around 400 megawatts or 4% of Bitcon’s global hash rate. In May, Marathon Digital, a Bitcoin mining company, joined forces with Zero Two, the digital asset division of Abu Dhabi’s sovereign wealth fund.

This marked the commencement of the UAE’s mining venture. Through their collaboration, two mining facilities have been established in Abu Dhabi. These plants generate a combined capacity of 250 megawatts (MW). Abu Dhabi has become a hotspot for all crypto mining operations in the UAE.

This is due to its energy efficiency and status as the center of trade in the country. The UAE possesses a distinctive Bitcoin mining capacity, as indicated by data from Hashrate Index, estimated to be around 400 MW. This capacity represents 4% of the global hash rate for Bitcoin.

Furthermore, the top four nations with the highest proportion of Bitcoin’s worldwide hash rate are the United States, China, Russia, and Kazakhstan. However, the UAE has the potential to gradually climb the ladder in this regard, thanks to its available resources.

UAE’s Clean Energy Shift: Bitcoin Mining with Zero Taxes

The UAE is a significant participant in the global energy market. It has transitioned its attention from relying solely on its oil and gas reserves to embracing solar and nuclear energy. The United Arab Emirates experiences significant fluctuations in electricity demands between the hottest and coolest months.

These fluctuations result in substantial losses of generated power. The UAE has the potential to benefit from Bitcoin mining by shifting its focus to clean energy sources. These sources include nuclear and renewable energy.

These sources could generate much of the country’s power within the next decade. Consequently, miners in the UAE could tap into the excess energy produced by these sources. Additionally, the country’s zero-tax policy is among the advantages that miners can enjoy.

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However, this implies that Bitcoin miners can enroll in any of the country’s 30+ free trade zones. Registering in these zones enables them to evade corporate tax, value-added tax, and import duties. This confers a notable benefit compared to conducting operations in Western nations.

Rida Fatima

News writer
An ardent wordsmith with a rich five-year background in delving into the realms of finance and cryptocurrencies. Alongside curating captivating blogs, Unique's talents extend to crafting imaginative and engaging content.