New Asia Bitcoin Mining ‘Paradise’ Now Approves Activity

New Asia Bitcoin Mining 'Paradise' Now Approves Activity

Kazakhstan seems to be moving towards a healthy coexistence with Bitcoin (BTC) mining, an activity that has intensified significantly since May in that territory. The government said that miners who comply with the law would not be subject to power restrictions and disconnections.

This is of particular importance because that Asian country concentrates 18% of the global hash rate, due to the prohibition of activity in China, which generated a significant exodus of BTC miners.

During a meeting Between the Minister of Electric Power of Kazakhstan, Magzum Mirzagaliev and representatives of the cryptocurrency industry, the government official recognized the “high potential of the blockchain industry”, for which he saw it necessary “Join forces for its further development”.

“I am a supporter of dialogue, so I call the miners to jointly search for solutions to ensure the reliability of the power system,” said Mirzagaliev, reviewing a press release from the Ministry.

According to the minister, the miners undertook to carry out their activities without threatening Kazakhstan’s energy security.

And on the side of the miners, they reported that they are willing to consider the possibility of buy electricity from the Kazakh state and also to other countries. This, added to the intention to invest in the creation of new energy sources.

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“We have a constructive dialogue with the Ministry of Energy. We received all the answers to our questions that bothered us. Of course, we, as citizens of our country, are interested in the stability of the electrical system. We have made a number of proposals that we will work together with the authorities in the near future, “said Islambek Salzhanov, President of the Blockchain Technology Association of Kazakhstan.

New Asia Bitcoin Mining 'Paradise' Now Approves Activity
Meeting between the Minister of Energy and representatives of the mining sector / Source: Ministry of Energy of Kazakhstan.

They also proposed to the Ministry of Electric Energy to carry out changes and additions to local legislation that has to do with the requirements and criteria for those who mine cryptocurrencies, which will allow them to find and act against so-called “Gray miners”.

In that country, gray miners are the main operators that hide the actual consumption of electricity by mining and they are settled on farms located in places where growth in energy use is unpredictable, such as towns in the south of that country. These, according to the law, must register with the government and legalize their business in order to continue operating.

“With such gray miners, of course, it is necessary to fight with the combined efforts of state bodies and associations. So we can achieve results, “said Salzhanov.

The parties expressed their intention to continue in their joint work, with the aim of stabilize the electricity market “And create the necessary conditions for the development of digital mining as a new industry.”

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Contradictions?

This meeting and support for bitcoin miners in Kazakhstan comes days after the Senate approved a bill that establishes the regulation of this activity and all that related to cryptocurrencies, under the excuse of financial crimes.

For the deputy Olga Perepechina, defender of the project, the people who issue, organize the trade of digital assets and exchange them for fiat money, securities and other properties, are out of financial monitoring, which leads to the possible money laundering and terrorist financing. This was reviewed by CriptoNoticias.

The law even seeks to classify all those who operate with bitcoin as “subjects of financial monitoring”, being obliged to notify the start or end of activities at Ministry of Digital Development, Aerospace Industry and Defense.

Consequence of migration

The regulations and accolades the bitcoin mining industry has received they were predictable. In May, China attacked the market – again – by banning all activity related to the cryptocurrency mining. And the exodus began.

Companies and people linked to this trade started to leave China, which promised sanctions to those who operate its territory. Two countries were destinations: the United States and Kazakhstan.

As mentioned at the beginning of the article, Kazakhstan, right now, the second country with the highest extraction rate, or hash rate, in the world; encompassing 18% of total global activity, according to figures from Chainalysis.

New Asia Bitcoin Mining 'Paradise' Now Approves Activity
Kazakhstan is the second country in the world with the highest hash rate, after the US / Source: Pixabay.

Such a mining boom, which brought with it an increase in the price of electricity (according to the Government’s version), made the state intention to intervene in the sector palpable. Now it is a fact.

Therefore, and in the face of the somewhat opposite views between the Kazakh powers, it is a matter of waiting and denoting, in time, how the industry develops, which, for sure, found a lobby in the Asian nation.

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