According to the new Minister of Digital Development of Kazakhstan, Bagdat Mussin. First of all, the country is in investment negotiations in its cryptocurrency mining sector. That amount to 300,000 million tenges (714 million dollars).
The Republic of Kazakhstan
It is a country in Central Asia. With a population of approximately 18 million people. Also, with an area of 2.7 million square kilometers.
Similarly, Kazakhstan has a dominant economy in Central Asia. Additionally, with the highest GDP and strong growth rates due to the large reserves of oil, minerals and metals. In short, it is a country that welcomes Blockchain.
Kazakhstan and its investment in cryptocurrency mining
Now, Askar Zhumagaliyev, former Minister of Digital Development, Innovation and Aerospace Industry of Kazakhstan, made this known while addressing the Senate. In a plenary session that took place on June 11 of this year.
By this time, Zhumagaliyev said they had studied the mining experience of countries like the United States, Sweden and South Korea. As a result, they realized that cryptocurrencies and cryptocurrency mining had become a part of everyday life.
Importantly, Kazakhstan already has 14 crypto mining facilities. Most of which are located in Pavlodar, Uralsk and in the northern and eastern regions of the country.
An impressive goal to attract more than $ 700 million in investment
It should be noted that Bagdat Mussin revealed that the country is currently in talks to receive this investment. And so, they can work on the expansion of the cryptocurrency mining sector.
In these circumstances, Mussin claimed that:
“Today we have agreements to attract investments worth 300 billion tenges. Similarly, the country is in the process of building four more mining farms. “
In the same way, the Central Asian country has also presented a proposal that would impose a flat tax of 15% on the sector. In an attempt to further supplement the profits from cryptocurrency mining, within the borders of the nation.
Miners migrate to Kazakhstan
According to the Center for Alternative Finance (CCAF) of the University of Cambridge. In April 2020, Kazakhstan accounted for more than 6% of the global Bitcoin hashrate. Which makes the country the fourth largest Bitcoin mining hub after China, the US and Russia.
Ultimately, if its $ 700 million investment in cryptocurrency mining prospers, Kazakhstan is very likely to secure a spot in the top three.
It is because of that Thomas heller, COO of Bitcoin mining and media company HAS HR8, said: “Kazakhstan has definitely been one of the fastest growing countries for Bitcoin mining in recent years«.
Still, even with a $ 700 million backing, Heller remains skeptical about whether the Kazakh mining center will outperform the pioneers.
Other important data
Likewise, in June the country approved legal amendments. Clarifying regulation and taxation of cryptocurrency mining, which it hopes will boost its oil-dominated economy. Precisely, it can provide relatively inexpensive electrical energy.
Meanwhile, Mussin argued that: “Driven by the country’s access to cheap electricity. An extension of Kazakhstan’s already successful mining operations could increase revenue”.
In parallel, the data published by the Cambridge Center for Alternative Finance (CCAF). They show that rising electricity bills in China are pushing miners to seek other locations.
By the way, Kazakhstan established tax regulations on cryptocurrencies in 2019. Consequently, the tax regulation generated profits through tax-free mining of cryptocurrencies. As long as the coins were not converted to fiat money.
Undoubtedly, the Senate also discussed in June this year, the current bill on the regulation of digital technology, including crypto assets. Therefore, the bill explicitly prohibits the issuance and circulation of unsecured cryptocurrencies unless the law provides otherwise.
By way of closing, I leave you this phrase from Peter Drucker: “Long-term planning is not thinking about future decisions, but about the future of present decisions«.