Can’t stand it anymore! Kazakhstan plans to increase tax on mining by 500%, and many miners are considering moving to the United States and Russia

According to the state-run Kazinform news agency, the Kazakh government is proposing stricter regulatory conditions for bitcoin miners, considering raising the “electricity tax” for cryptocurrency miners from 1 to 5 teng per kilowatt of Kazakh fiat. around $0.0023 to $0.012).

Kazakh Deputy Finance Minister Marat Sultangaziev even proposed requiring cryptocurrency miners to pay a monthly “equipment tax” regardless of whether miners receive block rewards or have ASIC equipment activated. He compares this idea to a tax on gaming equipment imposed by casino operators.

Kazakh Minister of Digital Development, Innovation and Aerospace Industry Bagdat Musin posted on Facebook on the 3rd, slamming unregistered “gray” miners for consuming up to 1GW (Gigawatt million watts, 1 watt = 1,000 watts) of electricity in Kazakhstan, pointing directly at gray miners Is wreaking havoc on Kazakhstan’s energy system, urging unregistered miners to speed up their registration with his office.

Currently, Kazakh divides miners into “gray miners” and “white miners”. White miners refer to miners that have been registered with the Ministry of Digital Development, Innovation and Aerospace Industry, while gray miners indicate that they have not yet been registered. Since the end of 2021, Kazakh authorities are stepping up to require miners to register.

Miners complain about being cut off by government
At the beginning of this year, due to large-scale protests due to energy shortages and rising fuel prices, Kazakh cut off national network communications, resulting in a sharp drop in the computing power of major mining pools; then a large-scale power outage occurred in the three Central Asian countries in late January. (KEGOC) has announced that it will cut off the electricity supply to miners until the end of January.

Multiple miners told The Block that they are still waiting for power to be restored. Kazakh miner Kanat Amren said the situation was still very serious, noting that “you can’t work without electricity, and the white miners are currently powered off”.

BlockchainKZ mining consultant Makhat Serikuly said:

We have restored power, but power is still limited. We used to have a surplus, but now we have a deficit and they (referring to the Kazakh government) are cutting power to mining companies.

After China imposed a mining ban last year, neighboring Kazakhstan, with cheap electricity, welcomed a large number of bitcoin miners and quickly became the second largest bitcoin mining country, after the United States and Russia. According to the global Bitcoin mining map of chainbulletin.com, the computing power is as high as 34.52EH/s in Kazakhstan, which is equivalent to 18.1% of the computing power of the entire Bitcoin network.

However, the situation in Kazakhstan is becoming more and more uncertain, and the supervision of domestic miners is becoming stricter. Many Kazakh miners told The Block that more and more miners are considering moving to the United States or Russia.

Russian President Vladimir Putin said on January 26 that Russia has a competitive advantage in cryptocurrency mining. Didar Bekbau, founder of Kazakh miner Xive.io, recently took to Twitter to praise Putin.

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