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Monday, May 23, 2022

Kazakhstan Government Has Proposed Hikes In Power Price

The government of Kazakhstan has been formulating a three-forked proposal that is designed to force crypto miners to pay much more for operating in the country. This entails that the land-locked nation wouldn’t be as attractive to the crypto industry anymore.

On the 4th of February, the First Vice Minister of Finance for the country, Marat Sultangaziyev, went on to propose an increase in price from $0.0023 per KwH to $0.01- specifically for the miners of cryptocurrency. He also went on to propose a tax on every GPU card and piece of equipment that is required for the mining of cryptocurrency. 

Kazakhstan Can No Longer Be The Favorite Hub of Miners 

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The third part of the proposal entailed removing most of the hardware of mining from being made an exemption on the Value Added Tax. In Kazakhstan- and other places in the world, the mining of Bitcoin does require the use of specialized hardware to complete the mathematical algorithms that are needed to create completely new blocks on the blockchain. Interestingly, most of the larger mining operations house around 10,000 mining rigs which include ASICs, racks, GPUs, cooling units, and associated facilities. 

Kazakhstan had been one of the most popular destinations for Bitcoin miners up until the political unrest that took last month leading to the government restricting all forms of internet access. Around the 5th of January, the hash rate of the Bitcoin network went down by 13.4% in a day from around 205 exahashes per second to 177 EH/s due to the shutdown that took place in the country. 

One of the largest Bitcoin mining operations that moved from China to Kazakhstan last July, BIT mining, mentioned last month that the political unrest in the country would not force the operations to move elsewhere. However, this confidence soon fell flat in the face of power and tax hikes. 

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