Crypto miners face yet another trouble as Kazakhstan limits electricity consumption for them. Before this move, the country was an excellent spot for crypto miners because it has meagre electricity rates. However, now that access to subsidised electricity will be limited, miners wouldn’t be able to operate at full scale in the country. It has also been reported that miners would need to obtain licenses from the authorities and renew them periodically.
Kazakhstan’s new law limits electricity consumption for miners.
The president of the country, Kassym-Jomart Tokayev, has signed a new law, “On Digital Assets in the Republic of Kazakhstan,” that brings many new rules and amendments to the current legal acts. There are specific definitions for the Tax code and the issuance and circulation of crypto assets. The idea behind formulating and implementing this new set of laws is to push development and level the market to create a fair playing ground for competition.
It also has changed the current registration system and allocated powers to different government bodies to oversee other sectors. However, the primary focus has been kept on mining companies and groups. The government has reported that the miners are being divided into two categories.
First are the ones that own mining infrastructure, meet specific requirements and run the farm independently. Secondly, we have those who own the infrastructure but rent it out to crypto farms and do not apply for energy requirements directly. Licenses would be issued to both these categories for a maximum of 3 years. It is also important to note that the mining firms should comply with the country’s IT rules and regulations and have their hardware installed in Kazakhstan itself.
The biggest problem
Crypto miners are not the least essential businesses for the government, as they can purchase electricity only if there is a surplus. There will also be no price caps, and electricity will be traded like equity or stocks on a government exchange KOREM. So, whoever pays the highest will get electricity. So, no more cheap subsidised power for Kazakhstan mining companies.
What are your thoughts as Kazakhstan limits electricity consumption for crypto miners? And do you think this will make miners move out? Let us know in the comments below. And, if you found our content informative, share it with your family and friends.
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