Local media and crypto news outlet Forklog reported that the government of Kazakhstan had accumulated over $7 million in taxes from cryptocurrency mining firms in the country during the last two years.
It comes as the industry faces growing regulatory pressure, limiting its access to low-cost energy while increasing its tax burden. Following China’s crackdown on the industry in the spring of 2021, Kazakhstan emerged as a hub for crypto mining.
However, its share of the global monthly hashrate has since shrunk from a peak of 18% in October 2021 to just 4% in May 2023, according to industry analyst Jaran Mellerud.
Since January 2022, cryptocurrency miners in Kazakhstan have been required to pay taxes and fees. By April 27, 2023, they had already transferred almost $540,000 to the budget, with all due payments for the first quarter due by May 25, according to the finance ministry.
On February 6, 2023, the new legislation titled “On Digital Assets in the Republic of Kazakhstan” was signed by President Kassym-Jomart Tokayev. This law oversees activities related to digital currencies, such as mining, and limits miners’ access to low-cost electricity due to allegations linking them to power outages.
However, Sergey Putra, who holds the position of Senior Coordinator for Governmental Relations at the National Association of Blockchain and Data Centers Industry in Kazakhstan, expressed his opinion that the implementation of the law through by-laws is arduous and does not appear to be geared toward aiding miners and the overall industry.
He voiced optimism that the current challenges are only fleeting and resolving them would usher in the nation’s new era of growth for bitcoin mining.
Bhutan Secretly Mines Crypto Using Hydroelectricity
Meanwhile, Bhutan, a small South Asian kingdom located in the Himalayan mountains, has been secretly mining cryptocurrency for years, according to a recent report.
The country has been able to mine crypto sustainably, using its vast hydroelectricity stores. This renewable energy source is largely considered “green” and is used to power the homes of the country’s 777,000-strong population. It represents 30% of the country’s GDP.
Recently, Bhutan has disclosed its efforts to develop its own crypto mines, utilizing its abundant resources to strengthen and maintain its economy in the future potentially.
Given Bhutan’s relatively small size and restricted resources, green crypto mining could offer a viable path toward achieving economic autonomy. The country’s mountainous terrain provides an optimal setting for cooling computer systems engaged in Bitcoin mining.
Bhutan aspires to become the world’s second nation to operate a state-owned crypto mine, following in the footsteps of El Salvador, the sole country currently doing so.
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