Kazakhstan To Fix Power Problems With Crypto: Details

The Kazakhstan government plans to modernize its energy system and grow its digital economy with crypto innovations. It wants to use crypto mining to improve its power grid system and expand crypto trading beyond its current limits. At the same time, it wants to allow more people to trade digital assets across the country.

Kazakhstan Proposes New Model for Energy and Crypto Mining

Kazakhstan wants to upgrade its old thermal power plants. To do this, the government has proposed a “70/30” model. Under this plan, foreign investors will help pay for the upgrades. In return, 30% of the new energy will be used for crypto mining, while 70% will go into the national power grid.

These efforts were outlined by Kanysh Tuleushin, Kazakhstan’s first Vice Minister of Digital Development, Innovation and Aerospace Industry. He said this is similar to what happens in the United States, where crypto miners use extra electricity when demand is low. This will help keep the power system stable. 

Kazakhstan also wants to use waste gas called associated petroleum gas (APG) to improve crypto mining. 

This gas comes from oil production and is often burned and wasted. The government plans to use it to power crypto mining farms, which will help reduce pollution and increase oil companies’ revenue.

Kazakhstan’s Crypto Mining Sector Is Growing

Kazakhstan’s mining sector is growing fast. Since 2023, the government has registered over 415,000 mining machines, given out 84 licenses, and approved five mining pools. The mining industry has already recorded $34.6 million in taxes over the last three years, and this came after it introduced laws to fight crypto mining tax fraud.

Furthermore, Kazakhstan is making progress with testing its digital currency, the digital tenge. So far, 250 billion have been issued, and the currency has tracking features to help stop corruption and ensure public money is used properly.

Kazakhstan To Expand Crypto Trading Outside AIFC

While countries like Nebraska is cracking down of crypto ATM due to increasing fraud, the Kazakhstan government is making new rules to make them accessible across the country. 

Kazakhstan is also developing new rules to legalize crypto trading. However, this requires approval from the National Bank and the Financial Market Regulation Agency. Currently, legal crypto trading only occurs in the Astana International Financial Centre (AIFC) zone. 

In 2023, crypto trading at AIFC exchanges reached $324.2 million, but by 2024, trading volume jumped to $1.4 billion. The government wants to change this by allowing trading across the country. 

Tuleushin said that if the government imposed a 10% tax on the unregulated trading market, it could bring in $372.9 million yearly. He said this revenue could help build schools, hospitals, and other public projects.

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