Kazakhstan president urges for crypto mining regulation

Kazakhstan looks set to adopt comprehensive regulations for its crypto mining industry.

Facing an electricity deficit mostly blamed on cryptocurrency miners, Kazakhstan is now trying to avoid energy problems this coming winter.

President Kassym-Jomart Tokayev said there was an urgent need to maintain power supply for, and called for the immediate legal regulation of the expanding crypto sector.

During his meeting with the energy minister Magzum Mirzagaliev, Tokayev criticised his department for permitting a slump in fuel reserves. He also said there was a need to ensure an uninterrupted supply of electricity for both businesses and households.

The minister said that the so-called “grey miners” were expected to consume up to 1,200 MW of electricity and work to identify them continues.

Kazakhstan as a hub for crypto miners

The head of state also said that Kazakhstan had significant resources to provide the domestic market with high-quality fuels and lubricants and an uninterrupted supply of electricity.

The Central Asian nation, which maintains low electricity rates, became a hub to a growing number of cryptocurrency miners amid an ongoing crackdown on Bitcoin mining in China.

When China announced a crackdown on Bitcoin mining and trading in May, citing environmental and financial concerns, many miners fled to the US, neighbouring Kazakhstan or Russia.

This year, the Kazakh Association of Blockchain and Data Center Industries – an industry body for crypto miners – confirmed that active crypto exchanges registered in the country will be required to start working with local banks to facilitate Kazakh customers’ access to cryptocurrencies, namely Bitcoin (BTC).

Recently, Kazakhstan has limited the amount of money local retail investors can put into crypto.

That means retail investors can invest 10% of their annual income or 5% of their total assets, excluding their main residence, up to $100,000 per year, as long as they provide evidence of their finances to the regulator.