If adopted, new legislation in Kazakhstan’s parliament will permit only licensed miners to create digital currency. It was created to fully regulate the sector and decrease what the sponsors refer to as the excessive consumption of electricity.
Lawmakers in Kazakhstan Submit Crypto Mining Law, Seek to Curb ‘Gray’ Mining
Members of the Mazhilis, the lower house of Kazakhstan’s parliament, have put forward a new bill introducing rules for the extraction of cryptocurrencies in the country. It stipulates that only registered companies at Astana International Financial Center or other non-resident entities with license data centers will be allowed to mine digital currencies.
Kazakhstan became a magnet for crypto miners following China’s crackdown on the industry and the influx of mining businesses has caused a growing power deficit. AIFC, the Central Asian nation’s financial hub, is in the focus of government efforts to place the country’s growing crypto sector under oversight. In April, local banks were permitted to open accounts for exchanges that had been registered.
According to Forklog, the current process for notifying authorities about mining activity is voluntary. An order from the minister for digital development regulates this process. Ekaterina Shlyaeva, Member of Parliament revealed that only a third have been registered in Kazakhstan.
“The uncontrolled use of electricity by ‘gray’ miners poses a threat to the energy security of Kazakhstan,” the lawmaker insisted. Smyshlyaeva said that the legislation currently in force does not govern the sales of cryptocurrency and local financial service providers, as well as the distribution of these digital assets. “The procedure for their production and the establishment of property rights to them are regulated only at sub-legislative level,” she explained.
According to Kazakhstan’s State Revenue Committee, the contributions of crypto mining entities to the state budget reached $1.5 million in the first quarter of 2022. In July, President Kassym-Jomart Tokayev signed into law a bill amending the country’s Tax Code to impose higher tax rates on crypto miners. These levies will now be based on electricity consumption for minting bitcoin and other crypto currencies.
Are you concerned that the law will reduce the number authorized to mine cryptocurrency in Kazakhstan? Let us know your thoughts in the comment section.
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