The United Arab Emirates (UAE) is emerging as a go to Bitcoin mining destination in the Middle East with a combined Bitcoin mining capacity of estimated to be around 400 megawatts or 4% of Bitcoin’s global hash rate.
With over 30 free trade zones and a growing contribution to the Bitcoin mining hash rate, the country has established itself as a pro-Web3 and crypto-friendly environment for crypto focused companies.
UAE Mining Journey
The UAE’s mining journey began in May with Bitcoin miner Marathon Digital partnering with Zero Two — the digital asset arm of Abu Dhabi’s sovereign wealth fund. The joint venture established two mining sites with a combined 250-megawatt (MW) capacity in Abu Dhabi.
Abu Dhabi, known for its energy efficiency and trade hub status, has become the forefront of mining activities in the UAE.
As per data UAE’s Bitcoin mining capacity stands at around 400 MW, representing approximately 4% of the global hash rate. The country’s abundant resources position it well to potentially climb higher in the rankings dominated by the United States, China, Russia, and Kazakhstan.
UAE Miner Benefits
As a global player in the energy market, the UAE has shifted its focus from its oil and gas reserves toward solar and nuclear energy. This transition offers an advantage for Bitcoin miners as they can tap into the surplus energy generated with other advantages such as country’s zero tax policy.
This means with over 30 free trade zones, miners can register their operations and avoid corporate tax, value-added tax, and import duties, giving them a significant advantage over Western counterparts.
In 2021 alone, the UAE combined power and desalination plants wasted 20 terawatt hours, equal to approximately $600 million.
By embracing renewable energy, the UAE aims to generate a substantial portion of its energy from nuclear and renewable sources in the next decade. This aligns with the growing trend in Bitcoin mining that prioritizes clean energy usage, making the UAE an attractive destination for miners.