Regulations that Kazakhstan is implementing would further hinder the country’s bitcoin mining industry.
With a third approval, the legislation will impose new licensing criteria for bitcoin miners based on their facility ownership and operational structure. The measure has received secondary approval from the nation’s federal parliamentary body. It would also mandate that miners acquire their electricity from the energy provider Korem at market rates.
In the past, particular tax and reporting regulations were in place, requiring the registration of names and addresses as well as quarterly reports to the government. These happened as a result of the massive increase in mining that took place amid electricity shortages and demonstrations, all the while bitcoin miners left China in response to the government’s decision to outlaw the cryptocurrency.
Kazakhstan attracted a significant quantity of hash rate due to its proximity to China and its formerly very favorable energy access. After that, Kazakhstan went so far as to seize up to $200 million in mining equipment from noncompliant miners, and the nation is still attempting to reap the rewards of the upsurge in bitcoin mining through the use of legislation like this most recently passed measure.
Kazakhstan’s regulation was originally covered by Bitcoin Magazine, which cited a story from the Russian news source Tass. “Kazakhstan was used as a raw material appendage of the blockchain industry,” Ekaterina Smyshlyaeva, a member of the Committee on Economic Reform and Regional Development of the Majilis (Kazakhstan’s federal parliamentary body), stated in the report. “[Through] bills, we oblige miners to license in Kazakhstan, that is, to create legal entities and become full-fledged subjects of taxation.”