China has issued a stern warning to its nationals engaged in cryptocurrency mining activities in Angola, stressing the harsh legal repercussions in light of Angola’s recent legislative changes. The Chinese Embassy underscored the enforcement of Angola’s new law titled the “Prohibition of Cryptocurrency and Other Virtual Asset Mining,” effective as of April 10, indicating a decisive crackdown on such operations.

Under Angola’s regulations, individuals involved in cryptocurrency mining face severe penalties, including the possibility of imprisonment ranging from one to twelve years. The primary objective of the law is to dismantle illicit networks conducting cryptocurrency mining that pose a threat to the country’s power infrastructure by consuming substantial amounts of electricity.

Impact on Energy Sector and Bilateral Relations

The prohibition comes in response to mounting concerns regarding the excessive energy consumption associated with cryptocurrency mining activities, estimated at 9.6 MW per day. This level of consumption is equivalent to the energy usage of 3,000 households, significantly impacting the stability of Angola’s domestic power supply.

Despite possessing the capacity to generate 6,200 MW of electricity daily, Angola faces challenges in effectively distributing energy, with a current daily demand of 5,500 MW. The legislation serves as a preemptive measure to protect the national grid and ensure a reliable power supply for the populace.

Moreover, China is actively bolstering its economic partnerships with Angola, exemplified by a recent agreement on investment protection inked in December. This accord provides Angolan enterprises with duty-free entry into China’s extensive consumer market, encompassing a wide array of products.

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