Kazakhstan, one of the world’s leading producers of cryptocurrencies, will tighten its laws on the virtual currency creation industry, an energy-intensive process in Central Asia’s largest state, which suffers from regular power outages. On Wednesday, the Mejlis, the lower house of the parliament, passed a bill, which specifically provides for the introduction of a tax and the issuance of a mandatory license for cryptocurrency mining companies, the official Kazinform news agency reports.
In recent months, the country, the region’s leading economy, has shown a willingness to facilitate the expansion of this activity, while tightening the fight against illegal mining farms where the computers needed for this sector are clustered. “The goal is to eliminate illegal mining and create an appropriate legal environment for entrepreneurs“Deputy initiator of the bill Ekaterina Smikhlaiyeva announced to AFP on Thursday, adding that this activity.”capital intensive with very high risks“.
“Mining farms must be located“and”miners will only be able to purchase electricity from the public grid if there is a surplus“, he said on Wednesday, citing Kazinform.
According to data from the University of Cambridge, which regularly conducts studies on cryptocurrencies, Kazakhstan was the third largest producer of virtual currencies in January 2022, concentrating 13.22% of activity, behind the United States (37.84%) and China (21.11%). ). ). Kazakhstan has many advantages for mining with one of the cheapest electricity prices in the world and a cold climate that makes it easy to cool computers. Five times the size of France, Kazakhstan has also benefited from the arrival of miners leaving China, a neighboring country where the industry is officially banned.
In March, the Kazakh government announced the closure of nearly 100 illegal mining farms, some of which are owned by the former president’s brother, the all-powerful Nursultan Nazarbayev. Kazakhstan’s power system dates back to Soviet times and, despite investment, remains dilapidated, causing periodic blackouts.
To mine cryptocurrencies, which is open to everyone on a decentralized network, several computers must solve complex mathematical calculations that are rewarded by issuing virtual currency. But this process requires high computing power, or hash rate, to run computers and, according to Cambridge University estimates, it will consume 0.6% of global output in 2021.
Source: Le Figaro
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