Kazakhstan has implemented new reporting criteria aimed at determining the pace at which crypto miners consume energy.
Every crypto-miner in the country is required to disclose complete details about their operations 30 days before they begin.
The new regulations are intended to establish how cryptocurrency mining affects the country’s electricity grid. Businesses engaged in digital mining must provide information such as technical specs for their power grid connection.
They must also include information on mining equipment and any planned investments in the coming year. Mining businesses must also submit information about the legal body in charge of the operation, its contact information, and the IP and physical addresses utilized for mining. A legal entity of this type must be based in Kazakhstan.
Crypto miners will also be required to produce quarterly reports that update the initial information provided as part of the new reporting requirements. Additionally, businesses that choose to cease operations must notify the government.
Kazakhstan has modified its stance on cryptocurrency miners in recent months. Because of the new de facto prohibition on crypto-related operations, the country had previously welcomed miners from China.
Kazakhstan is rethinking its approach due to the impact of mining activity on its electrical grid. In recent months, the government has cut off miners’ access to power on many occasions and begun raising bills.
According to the Minister of National Economy, the government intends to raise crypto mining taxes. Energy costs are presently ten times higher for miners, but if the tax idea passes, they might become even more expensive.
The proposal also proposes eliminating the mining equipment VAT exemption. This new strategy aims to control the mining business and eliminate illegal mining, which has grown in popularity in the country.
In March, the Financial Monitoring Agency broke down 106 unlawful crypto mining businesses, seizing 67,000 pieces of equipment, according to the agency. After the United States, the country has the second-highest Bitcoin hash rate.
There are fears that the new regulation may force crypto miners to migrate to other nations, such as Uzbekistan, which is offering income tax exemptions to miners who use solar energy.