Kazakhstan Might Increase BTC Mining Tax By 500%; Where Would Miners Run To?

Bitcoin mining is becoming a global problem worldwide, considering the amount of electricity required to run their heavy machines day in day out. At one point, experts accused miners of destroying the environment. That is not to say that bitcoin miners do not have their challenges; they do.

China was the first country to get rid of BTC miners by placing a ban on cryptocurrency and other related activities. This was a massive blow to Miners who had to seek shelter elsewhere.

Many of them swarmed to Kazakhstan because of the cheap power and ample natural gas supply available there. With time, more miners came to settle in the country. 

Unfortunately, it appears that the glory days are over as miners have been facing power shortages and internet shortages for months now.

Increased Fuel Prices 

The country witnessed chaos and turmoil after the price of fuel was increased. The protests by citizens online and in the streets led to the government shutting down internet service and introducing security lockdown.

Though things have gone back to the way they used to be, the government is thinking of tightening its regulation on miners. This action could force several of them to exit the country searching for greener pastures, with Russia and the United States being likely destinations. 

As reported by Kazinform on the 4th of February, the government is thinking of increasing electricity for miners from 1 ($0.0023) to 5 ($0.012) tenge. 

The Issue Of High Tax Rate

Things could be turning sour for miners of BTC as the vice minister of the country in charge of Finance, Marat Sultangaziev, is asking for monthly taxation of the equipment used by miners of cryptocurrency irrespective of whether they receive block rewards, turn on ASICs, or not. Sultangaziev compared the tax to that paid on casino machines by their owners.

Before now, the minister in charge of digital development, Badgat Musin, stated that unregistered miners use up to 1 gigawatt of electricity for their operations. Musin is asking the public to report cases of unregistered miners to the relevant authorities. 

The current rules in the country have separated “white” miners from “gray” miners. While the white miners have signed an agreement to the new terms of the Kazakhstan government, the gray miners are yet to succumb to a new authority. Musin is asking defaulters to register with the department and follow further instructions. 

With laws on mining activities becoming strict in Kazakhstan, those who run such businesses may have to go to the United States or Russia, where the laws are less stringent.

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