Kazakhstan will become an important location for the Bitcoin miners who are looking for a place with cheap energy. That became especially relevant after the halving of the cryptocurrency in May this year, which reduced their profits.
According to recent messages, the Central Asian country that is rich in oil estimates that by the end of 2020 the investments in mining crypto will double, and in the course of the next three years, the country will attract an additional $738 million in that sphere.
The government of the country has recently legalized the mining of crypto. In December 2019 the local media reported that lawmakers won’t tax crypto miners until they turn their assets into fiat money.
The law, approved by the Kazakhstani Senate and signed by the president in June this year, states that people that mine cryptocurrency should inform the government about their activity. It also states that miners are legal owners of the digital assets that they produce.
The main players in Kazakhstan so far are foreign companies from China, Japan, and other Asian countries. The recent changes are already generating interest in international companies based in the West as well.
The most important aspect of Kazakhstan`s attractiveness for mining crypto, however, is not the regulatory framework, as much as the low costs of energy in the country. At rates from December 2019, the cost of energy per kilowatt-hour in Kazakhstan is $0,041 for households and $0,049 for industry. For comparison – the average cost for the same amount of energy in the US is $0,14.
According to data from researchers based at Cambridge University, in the second quarter of 2020 Kazakhstan was on the fourth place in mining Bitcoin in the world, controlling around 6,17% of the hash rate. Russia (6,9%) and the US (7,24%) take third and second places accordingly. China remains the undisputed leader in mining Bitcoin with more than 65%.
The vice-president of the mining pool Poolin Alexandro de la Torre believes that if certain conditions are met, Kazakhstan could enter the top three counties in mining Bitcoin in the world.
