The Venezuelan government issued an emergency bulletin announcing that electricity demand has now reached 15,579 megawatts (the highest level in nine years).
According to official government communiquépolicymakers have launched a supervisory plan to crack down on illegal cryptocurrency mining and harshly punish violators.
Venezuela’s power grid was already facing problems long before Bitcoin existed
Latest information on OPEC annual statistical review Venezuela says it holds about a fifth of the world’s oil reserves, about 303 billion barrels. This country also has Guri Dama gigantic hydroelectric dam and the second largest hydroelectric power plant in the world, once providing 80% of the country’s electricity.
According to Research by the Bogen Projectthe government charged electricity rates so low that Venezuelans only paid about 20% of the actual cost of generating electricity.
As a result, the state-owned power company Corpoelec struggled to properly maintain the power grid or even invest in new infrastructure with limited resources, eventually leading to transmission lines collapsing.
In addition, large numbers of immigrants were sent More than 7 million Venezuelans are abroad Since 2015, it includes the skilled engineers who once ran everything in the factory. This meant that the skill gap widened significantly.
As expected, the Guri Dam collapsed, and on March 7, 2019, the entire country was plunged into darkness. Center for Strategic and International Studies published a report on the incident He said most cities were without power for more than 90 hours, threatening the lives of many people, especially critically ill patients in hospitals.
At the time, Maduro’s government blamed opposition leaders and the United States for the blackouts, accusing them of “using cybernetics and electromagnetic attacks.” but investigative reporting Instead, it blamed years of neglect, corruption and mismanagement.
Miners went to Venezuela precisely because electricity was cheap.
Venezuela subsidized its power grid and offered near-zero electricity rates, making the country a safe haven for Bitcoin mining. BTC computers run 24/7 and use a lot of electricity, so cheaper electricity only made it more profitable for miners.
Ordinary citizens also turned to mining because it was a way to earn dollars in a country where hyperinflation had rendered the local currency nearly worthless. in fact, Operating mining rigs in Venezuela could yield even more production. One month more than most workers earn in a year of hard labor.
In other words, the crackdown has been going on for years and is not a new declaration. For example, regulators launched an anti-corruption campaign, seizing approximately 2,000 mining equipment in Maracay and forcing the Ministry of Power to Disconnect all crypto mining farms From the national grid in May 2024.
“The goal is to disconnect all cryptocurrency mining farms in the country from the National Electricity System (SEN) and avoid any significant impact on demand. This will allow us to continue to provide efficient and reliable services to all Venezuelans,” the Ministry of Education and People’s Power (MPPPE) said on its Instagram account.
Carabobo Governor Rafael Lacaba even told the public to report people mining cryptocurrencies, saying, “If you see a house that you know is mining cryptocurrencies, just tell them to turn off the power to their farms or report them. Because they are drawing electricity directly from the grid to make money. And if they don’t stop, we will not have electricity service.”
Government says ban is necessary, but numbers tell a more complicated story
An official statement from the Venezuelan government said electricity demand reached 15,579 megawatts due to the heat wave and “economic growth that maintains its momentum.”
The government also said it was working on a monitoring plan to stabilize the power grid and was sending technical teams, and underlined the ban on digital mining.
“The absolute prohibition of digital mining on the national territory is supported. Those who illegally exploit this activity will be subject to sanctions as provided by law.” — Venezuelan Government Communiqué, May 7, 2026
Unsurprisingly, the government spent much of its statement blaming international sanctions for grid failures and announcing long-term plans it plans to disseminate to the private, industrial, academic, and scientific sectors. The ban on crypto mining was near the end and was almost an afterthought, suggesting it was not the main idea.
Sanctions, unpaid bills and missing engineers are the real problems
According to Eva Daily coverage Due to the state of Venezuela’s power grid, international equipment suppliers are demanding that the government provide upfront guarantees for grid repairs, which may not be possible. Mismanagement of funds, sanctions, collapsing oil revenues, and the costs of establishing an authoritarian political system have left the country financially bankrupt and severely constrained government capacity.
Now, because the government can’t pay, suppliers are refusing to give credit for parts and the grid continues to deteriorate. According to Wikipedia’s comprehensive explanation of the 2024 power outage in VenezuelaFor nearly 14 years, the Maduro government has remained silent on the current state of the electricity system.
The engineering talent that held back Gridam and the wider power transmission system left the country as part of the exodus. Banning crypto miners won’t help much because without them we can’t actually operate our complex hydroelectric power generation and transmission systems.
