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How Congo's Cobalt Quotas Hit Crypto Mining Costs
The DRC's new quota system forfeits unused cobalt export allocations to a government reserve, driving prices from $21k to $56k per tonne. Here's how that affects battery costs and crypto mining.
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The Democratic Republic of Congo is done letting miners stockpile unused cobalt export rights. Starting January 2026, any monthly allocation left unused is forfeited to a government-controlled strategic reserve.
The annual cap is 96,600 tonnes for both 2026 and 2027. Of that, 87,000 tonnes go to producers on a pro-rata basis. The remaining 9,600 tonnes sit with ARECOMS, the regulatory body. CMOC gets roughly 6,650 tonnes. Glencore gets about 3,925 tonnes, with an extension granted for shipping delays in early 2026. Eurasian Resources Group also received an allocation.
President Félix Tshisekedi is backing the quota system with serious enforcement. Violators face permanent export bans. The quotas follow an extended export ban that the DRC imposed to reassert control over its most valuable mineral resource.
The market has already responded. Cobalt prices climbed from around $21,000 per tonne in early 2025 to over $56,000 per tonne by mid-2026, a 167% jump in about 18 months. Oversupply, largely driven by Chinese-backed operators like CMOC, had cratered prices before the DRC intervened. The export ban and subsequent quota system flipped the supply dynamics overnight.
Cobalt is a critical component in lithium-ion batteries, which power everything from electric vehicles to grid-scale energy storage. Rising cobalt costs mean more expensive batteries. For industries like crypto mining, which depend on cheap, reliable electricity, any increase in battery costs for backup systems or time-shifting power adds to operational expenses.
The big risk is on the demand side. Lithium iron phosphate batteries use no cobalt at all. Tesla already moved toward cobalt-free designs for its standard-range vehicles. Other manufacturers are following. The DRC is betting that cobalt remains essential enough to justify supply control. For now, the market is validating the bet with higher prices.
The quota system takes effect in January 2026. First allocation adjustments will test how tightly the DRC enforces the forfeiture rule.