Key Highlights
- Laos aims to monetize excess hydropower with cryptocurrency mining
- Dams have displaced thousands and disrupted rivers and fisheries
- High public debt and inflation create risks for the digital economy plan
Laos Looks to Turn Excess Hydropower into Crypto Profits
Laos is exploring the use of excess hydroelectric power for cryptocurrency mining, sparking both international interest and domestic criticism, according to media reports.
The country’s long-running dam construction program has created a surplus of electricity while leaving Laos with billions of dollars in debt. Authorities are now seeking to monetize this excess through the energy-intensive crypto industry.
A report by the state-run Vientiane Times following a government meeting noted policymakers are considering “long-term economic opportunities,” including digital asset mining, which could turn surplus electricity into economic value.
Critics warn of serious social and environmental consequences. Dams have disrupted rivers, reduced downstream harvests, damaged fisheries, and forced thousands to relocate. Vitoon Permpongsakaroen, director of the Mekong Energy and Ecology Network, emphasized that the initiative is driven not by domestic need but by debt pressures.
Hydropower is also seasonal; during the dry season, Laos often buys electricity from neighboring countries, particularly Thailand. According to Pianporn Dites of International Rivers, promises to compensate displaced communities have largely gone unfulfilled, leaving many worse off.
Economic Ambitions Clash with Social and Environmental Concerns
Despite criticism, the move has drawn attention from investors in the region. Laos aims to become a fully digital economy by 2030, licensing local crypto mining and trading platforms while attempting to regulate Chinese miners who moved operations to the country after China’s 2021 ban.
In May 2023, Laos unveiled a digital economy strategy, focusing on blockchain, AI, IoT, and electronic finance. In August, state-owned Electricite du Laos announced it would cut power to crypto farms due to drought, export commitments, and unpaid debts.
Risks remain high. The International Monetary Fund warned in November that “significant levels of public debt pose challenges to the medium-term economic outlook,” while inflation and a declining Kip, which has lost half its value against the US dollar over five years, add further strain.
The situation is compounded by US tariffs, currently at 40% on Laotian exports, among the highest for Washington’s trading partners.
Source: https://coinpaper.com/11112/laos-considers-using-excess-hydropower-for-cryptocurrency-mining
