In Kazakhstan, the world’s third-largest market by Bitcoin mining hash rate, local cryptocurrency mining operators are complaining to the national leader about rising energy prices.
According to local media, there are eight major cryptocurrency mining operators Occurred An open letter to the President of Kazakhstan, Kassym-Jomart Tokayev. This list includes BCD, TT TECH Limited, KZ Systems, AI Solutions, Green Power Solution Ltd., VerCom, and KINUR INVEST.
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The letter states that Kazakhstan’s cryptocurrency mining industry is in a “very disturbing situation” due to high energy prices for miners. According to the text:
“As of today, all major players in the industry have suspended their activities and plan to completely cease their business in the Republic of Kazakhstan by the end of the year.”
The executives who signed the letter believe that the situation with prices hampers the government’s efforts to regulate the cryptocurrency industry in general and mining in particular. According to the letter, the problem is a result of the decision to raise energy taxes for cryptocurrency miners. Because of the taxes it imposes, the country has already lost its place among the leaders of cryptocurrency mining such as the United States, Russia and China, and the industry stands on the brink of extinction, the letter claims:
“If the government does not take urgent action, the digital mining industry in the Republic of Kazakhstan will cease to exist.”
The country imposed taxes on digital mining on January 1, 2022, based on electricity consumption by mining entities. The law emerged amid growing national frustration over cryptocurrency miners’ use of the national power grid.
Even at the highest mark, 1 kilowatt-hour of taxable electricity in Kazakhstan costs miners about $0.067, which is a very large number. minimum From an average of $0.12 per kWh before any US taxes. According to data released by the Kazakh government, it received only about $7 million (3.07 billion tenge) in tax payments from cryptocurrency mining entities in 2022.
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