17.2 C
Manchester
June 27, 2022
Image default
Bitcoin

Kazakhstan struggles to bear the brunt of China’s exiled bitcoin miners

Registered Bitcoin miners are starting to turn against the operations “irregular“.

Kazakhstan, which has become the second most popular country for Bitcoin mining, according to data from Cambridge Center for Alternative Finance, is at a crossroads thanks to depleted natural resources, a desire to move toward renewable alternatives​​and calls from regulated miners to clean up an underground cryptoeconomy.

Kazakhstan’s Energy Minister Magzum Mirzagaliyev assured miners yesterday that regulated operations would not be cut off from the national electricity grid. However, so-called irregular miners, those who are not registered with the government, may soon have to make a choice between registering or leaving the country.

Kazakhstan is a country in Central Asia that is rich in natural resources. The former Soviet republic boasts some of the lowest electricity prices for homes or businesses in the world (about half the rates in the US) – ideal for energy-intensive Bitcoin mining. Furthermore, cryptocurrency mining remains cheap in Kazakhstan, not because of a purely free market but, ironically, a state-regulated market that relies on coal to drive a well-performing economy.

The country is starting to feel the pressure, especially as it appears to shift to greener energy sources. The government estimates that cryptocurrency mining consumes 8% of the country’s electricity capacity – with two-thirds of that coming from unregulated miners.

The National Association of Blockchain and Data Center Industry, a trade group in Kazakhstan, sees an easy solution. On Tuesday, he urged the government to go after irregular miners, who have the potential to wreck the relatively smooth deal for the regulated.

“Although many illegal miners have established operations [sic] in recent months, there have been many Bitcoin mining companies that have been operating in the country for many years, that fully comply with all laws, pay their taxes and provide local jobs.”

Said the president of the association, Alan Dorjiyev. He added that the association is “proactively collaborating with” the Ministry of Energy and the Ministry of Digital Development for “create a fair and transparent market where those who follow the rules can operate while those who don’t will be forced to close.

According to a report by Reuters on Wednesday, some irregular miners are concerned about official registration not only because of increased fiscal requirements, but also because of additional government proposals under discussion.

“The tax the government plans to introduce is something miners can afford.”

The news agency said quoting an anonymous miner.

“But it’s not clear what demands the government can bring forward.”

If it’s too much, Bitcoin mining could be on the move again.

Source: Decrypt

Related posts

NASCAR driver Bubba Wallace designs the Bitcoin logo on his car

Anupreet Kaur

KuCoin plans to launch the NFT token exchange –

Aparnna Hajirnis

Chainlink joins forces with Cocoa – Blocksats

Aparnna Hajirnis

Leave a Comment