The most popular cryptocurrency in the world is bitcoin. However, for the miners in Kazakhstan who are involved in mining bitcoins, this may soon translate into a tax rise.
The Kazakhstan mining boom is over
The Kazakh government may introduce new taxes, which will negatively affect the digital currency market. Kazakhstan was once perceived as a very attractive destination for bitcoin miners.
At a government conference on April 14, Minister of National Economy Alibek Kuantyrov stated that he and his colleagues are working on a new tax system that would correlate tax payments to miners with the value of the coins they mine. He went on to say that this will assist the authorities in collecting tributes and will improve the state budget’s predicament.
“We are thinking about raising the tax burden on cryptocurrency miners.” At the moment, we are thinking of tying miners’ tax rates to the value of the cryptocurrency [that they mine]. He explained that if cryptocurrency gets more expensive, it will be beneficial to the budget.
However, many miners may be influenced by this decision to relocate their BTC mine’s headquarters. They may go to El Salvador, for example, where the mining tax will be 10%.
Consider that Kazakhstan’s government welcomed bitcoin miners with open arms just a few months ago. However, the country has come a long way: from offering cryptocurrency miners some of the world’s cheapest energy to imposing a 20 cents per kWh mining tax. In just one month, the latter quadrupled energy costs.
The government has also begun to close many mines.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.