Crypto Miners to Pay Higher Rates for Electricity in Kazakhstan | 'Negative Impact on Investment Attractiveness'
(Photo : Screenshot From Commons.Wikipedia.org) Crypto Miners to Pay Higher Rates for Electricity in Kazakhstan | 'Negative Impact on Investment Attractiveness'

Cryptocurrency miners over in Kazakhstan will be paying more compared to other consumers for the electricity they need in order to mint new digital coins. The country's president has just signed a law that would impose additional fees for the needed power by the energy intensive crypto mining industry.

Kazakhstan to Raise Crypto Mining Electricity Prices

According to News.Bitcoin.com, crypto mining entities over in Kazakhstan will be paying a surcharge for the needed electricity that they use. President Kassym-Jomart Tokayev has just signed a brand new law which would amend the Central Asian republic's legislation when it comes to taxes as well as other obligatory payments to the budget.

The bill was voted by the Senate some time in early June 2021 and would introduce 1 Kazakhstani tenge (which is around $0.0023) for every kilowatt-hour that needs to be used by cryptominers. The brand new electricity rate will be imposed during the first day of next year on Jan 1, 2022, according to Forklog.

New Crypto Law Sees 'No Critical Consequences'

Authorities over in Nur-Sultan now claim that the additional charge will in fact "bring out of the shadow" those particular cryptocurrency miners that are still operating in the gray economy as of the moment. Albert Rau, the lawmaker that was named as the author of the bill by local media gave a statement.

Rau noted that they could not foresee any actual "critical consequences" from this new adoption. Rau also insists that the official parliament has already approved a "government version" of the said initially proposed amendments.

Crypto Representatives Speak Up

Representatives coming from the cryptocurrency sector express disagreement with Rau's current position along with a warning that this move actually comes at a really inappropriate time. The members of Kazakhstan's National Association of Blockchain and Data Center Industry stated to the crypto news outlet that the decision will in fact have a really negative effect on the potential investment attractiveness of the industry itself.

The main concern as of the moment is that the fee might turn away Chinese companies that have been looking around for other particular jurisdictions throughout the ongoing China crackdown on crypto mining. Kazakhstan has also recently been considered as a potential mining destination due to the country warming up towards the crypto industry over the past few years

Read Also: [Breaking] South Korea Crypto Exchanges Could Sue Government for Alleged 'Unconstitutional' Banking Requirements

Chinese Cryptominers Moving to Kazakhstan

Back in May, 2021, Bit Mining, a Shenzhen-based crypto mining company announced its plans to build a massive 100MW mining data center in Kazakhstan along with two local firms as partners. In June, Chinese authorities intensified their push on bitcoin mining operations and the company started to ship out mining devices in Kazakhstan. 

Some time earlier this month, Canaan, a Hangzhou-headquartered mining hardware manufacturer, established an after-sales service center in Kazakhstan as even more Chinese miners decided to relocate to Central Asia.

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Written by Urian B.

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