Regulations are changing for bitcoin miners in Kazakhstan after serving as a top destination for the industry since the late 2010s. Starting in 2022, a new law passed by the Kazakhstani government will tax cryptocurrency mining revenue for the first time.
No one likes taxes, but the policy change is well timed for the government’s interests. Many Chinese miners leaving their Asian farms behind are relocating to Kazakhstan. On top of the large mining presence already in the region, the new tax bill is expected to generate billions of dollars in revenue.
As of April 2020, Kazakhstan accounted for over 6% of the global Bitcoin hashrate. At least 14 separate mining farms also operate in the country, as of estimates from July 2020, although the estimates are difficulty to arrive at since there are no registration requirements for bitcoin miners, unlike other countries such as Iran.
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With the Chinese exodus of miners, many of whom are arriving in Kazakhstan, the country’s percentage of the network’s hashrate is sure to grow over the coming years so long as regulators don’t transform the region into a hostile environment.
Isolating exactly where Kazakhstani bitcoin mining farms are located is difficult. But a few regions slicing through the middle of the country are known to be locations of a few mining operations. Some of those areas are shown in the map below, including, Karaganda, Pavlodar, Taraz and Ekibastuz.
What’s next for Kazakhstani miners?
Despite the new tax law, there are few to no indications that mining migration to Kazakhstan will slow down. In the current mining environment, wherever hosting space can be found – provided the environment is not hostile – is a place that miners will go.
For years Kazakhstan has continued to grow its dominance in the global hashrate market. Assuming its regulators don’t transform the country into a burdensome regime with exploitative regulations, more growth in Kazakhstan’s cryptocurrency mining industry can be expected for years to come.